As little as 1 ppm SOx present in the exhaust of a lean burn natural gas engine strongly inhibits the oxidation of CH4 over a Pd containing catalyst. Non-methane emissions oxidation, such as C2H6, C3H8 and CO, are also inhibited by low SOx concentrations, but to a lesser extent than CH4 emissions. The mechanism for SOx inhibition indicates a 1:1 selective adsorption of SOx on PdO for palladium on a non-sulfating support such as SiO2. Deactivation is therefore very rapid. In contrast, palladium on sulfating supports, that is gamma-Al2O3, deactivate more slowly and can tolerate more SOx because the SOx is also adsorbed onto the carrier. The activation energy for methane oxidation is dramatically increased after SOx poisoning for all Pd catalysts, while the Arrhenius pre-exponential term is relatively constant, indicating a transformation from very active PdO sites to less active PdO-SOx sites. Platinum catalysts are considerably less active than Pd as evidenced by a much lower pre-exponential term, but are more resistant to deactivation by SOx. Non-methane hydrocarbon and particulate emissions standards for lean burn natural gas engines for the United States can be met with Pd catalysts. However, the non-enforced methane emissions standards are not met. For the European truck test cycle, methane emissions standards are met since the test cycle heavily weights the hotter modes where Pd-SOx is sufficiently active.