The hydrogen permeation process is crucial for hydrogen purification through a metal alloy. At the initial stage, it is connected with the dissociation and adsorption of hydrogen on the surface; subsequently, the process involves hydrogen absorption in the bulk. On the PdAg23 alloy, we investigated the mechanisms of adsorption and absorption by in-situ ultrahigh vacuum and ambient pressure X-ray photoelectron spectroscopy (AP-XPS) measurements, respectively. During the adsorption under a H-2 pressure of 5x10(-8)Torr at 300-620 K, the surface Ag atoms act as adsorption sites for the hydrogen atoms. The AP-XPS results show that hydrogen absorption is significantly enhanced above 473 K under H-2 exposure at 1.5 Torr, which is likely correlated to the a-ss hydride phase transition occurring around 473 K. Hydrogen preferentially bonds with the Pd atoms rather than the Ag atoms in the case of hydrogen absorption into the PdAg23 alloy. The atomic fractions of Pd on the surface were enhanced after hydrogen absorption, and hydrogen adsorption at a hydrogen pressure of 5x10(-8)Torr at 620 K. This surface segregation of Pd atoms provides more reactive sites for hydrogen absorption, which may promote the hydrogen permeability of a PdAg23 alloy.