Silver/cobalt oxide binary component catalysts were prepared using physical vapor deposition (PVD) coupled to an ultrafine particle beam (WB) system. The activity of the catalysts was studied using the decomposition of dinitrogen monoxide (N2O) gas as a model reaction. Scanning electron microscope (SEM) images of the samples after the decomposition reaction indicated that the silver particles were in contact with the cobalt oxide. X-ray photoelectron spectroscopy (XPS) measurements and decomposition tests showed that the interaction between the silver-cobalt oxide was weak. A simplified model is proposed for understanding the interaction between the two components and their catalytic activity.