A novel strategy to direct the oxygen reduction reaction to preferentially produce H2O2 is formulated and evaluated. The approach combines the inertness of Au nanopartides toward oxidation, with the improved 02 sticking probability of isolated transition metal "guest" atoms embedded in the Au "host". DFT modeling was employed to screen for the best alloy candidates. Modeling indicates that isolated alloying atoms of Pd, Pt, or Rh placed within the Au surface should enhance the H2O2 production relative to pure Au. Consequently, Au1-xPdx nanoalloys with variable Pd content supported on Vulcan XC-72 were prepared to investigate the predicted selectivity toward H2O2 production for Au alloyed with Pd. It is demonstrated that increasing the Pd concentration to 8% leads to an increase of the electrocatalytic H2O2 production selectivity up to nearly 95%, when the nanoparticles are placed in an environment compatible with that of a proton exchange membrane. Further increase of Pd content leads to a drop in H2O2 selectivity, to below 10% for x = 0.5. It is proposed that the enhancement in H2O2 selectivity is caused by the presence of individual surface Pd atoms surrounded by gold, whereas surface ensembles of contiguous Pd atoms support H2O formation. The results are discussed in the context of exergonic electrocatalytic H2O2 synthesis in Polymer Electrolyte Fuel Cells for the simultaneous cogeneration of chemicals and electricity, the latter a credit to production costs.