It is known that a single chemisorbed layer of zerovalent iodine atoms catalyzes, at ambient temperatures, the anodic dissolution of Pd (to Pd2+ species) even in inert (halide-free) electrolyte. Early experiments based on low-energy electron diffraction (LEED) and Auger electron spectroscopy (AES) showed that, regardless of the rate or duration of the corrosion reaction, the composition and long-range order of the Pd(111)-(root 3 x root 3)R30 degrees-I adlattice, before and after the dissolution, were essentially identical. Follow-up studies based on medium-resolution electrochemical scanning tunneling microscopy (EC-STM) demonstrated that, at very low rates, the layer-by-layer dissolution occurred exclusively at steps rather than on terraces (where dissolution would necessitate I-Pd place exchange). The present study introduces atomic-resolution EC-STM images that show I-atom-constituted but Pd-atom-deep pits on terraces at more positive applied potentials (i.e., at much higher dissolution rates); such uniquely proportioned pits suggest I-Pd place exchange on terrace sites in which underlying Pd atoms are segregated to the surface prior to their dissolution; that the pits increase laterally but remain one Pd atom deep indicates a layer-by-layer dissolution sequence immediately after an initial place-exchange mechanism. When the potential is reverted back to the double-layer region, the pits disappear, and in conformity with the LEED experiments, the well-ordered Pd(111)-(root 3 x root 3)R30 degrees-I adlattice is regenerated; such a process implies a reverse I-Pd place exchange in which the embedded iodine is transported back to the uppermost layer.