Kinetics of carbonylation of allyl chloride using a Pd metal catalyst in a two liquid phase system has been investigated in a temperature range of 298-318. K. This reaction represents an interesting case of a gas-liquid-liquid-solid catalytic reaction wherein the adhesion of catalyst particles at the liquid-liquid interface leads to a significant enhancement in the rate of carbonylation. The effect of catalyst precursors, PPh(3) (a promoter) concentration ratio of organic to aqueous phase volumes. CO pressure, concentrations of allyl chloride, catalyst and sodium hydroxide on the rate of carbonylation was studied. The reaction was found to be first order with CO and NaOH concentrations. With increase in allyl chloride concentration, the rate passed through maxima showing substrate inhibited kinetics. A molecular level description of the carbonylation reaction mechanism has been postulated to derive a rate equation, in which the reaction between Pd- allyl chloride and [Pd(CO)Na+OH.] species as a rate determining step has been proposed. This rate model was found to represent the experimental rate data satisfactorily for all temperatures. A detailed analysis of the accuracy of the kinetic model and significance of the rate parameters has been discussed. An activation energy was found to be 51.8, kJ/mol.