Electron microscopy, electron diffraction, EXAFS, and ultracentrifuging data show that a new catalytically active cluster prepared by reduction of Pd(OAc)2 by H2 in the presence of L = 1,10-phenanthroline, or 2,2′-bipyridine, followed by O2 treatment, contains a close-packed metal nucleus (570 ± 30 Pd atoms) bearing 60 ± 3 co-ordinated L and 180 ± 10 OAc– in the outer sphere of the cluster.