Hydrogen absorption behaviour of intermetallic absorbers strongly depends upon the contribution of the surface layers into the overall rate of the hydrogenation process. Activation process, which is normally required to initiate and facilitate the initial hydrogen uptake, may be waved by modifying the surface behaviour, thus offering obvious practical benefits. In the present work a surface nanoengineering approach was developed to enhance the hydrogenation ability of rare earth-containing AB(5)-type hydride-forming intermetallics. The modification involves three successive steps; (a) fluorination to form a surface-covering REF3 layer with a high specific surface area; (b) surface functionalization by gamma-APTES; (c) deposition of Pd nanoparticles into the surface nanocavities of the fluoride. The surface functionalization step was applied to immobilize Pd nuclei inside the nanocavities of the REF3 layer. The deposited Pd nanoparticles exhibited a high degree of coalescence, and were further transformed into a continuous surface layer. Pd/fluoride modified materials exhibited exceptional Pd coating densities and imposed a large facilitation in the kinetics of hydrogenation compared with the conventional nonmodified intermetallics. The approach has a potential in the directed design of new classes of highly efficient and robust composite hydrogen sorption materials for hydrogen storage, separation and purification. Large improvements in the kinetics of hydrogenation of the Pd/fluoride modified intermetallics also manifested by extraordinary surface poisoning tolerance towards oxygen and water vapour, as compared with that of the nonmodified, or just fluorinated/Rd modified intermetallic alloys. The developed classes of highly efficient and robust composite hydrogen sorption materials have the potential for application as sorption media for the high efficiency hydrogen storage, separation and purification systems and may facilitate progress towards the implementation of the key elements of future hydrogen economy. Copyright (C) 2009 John Wiley & Sons, Ltd.