Nanostructured palladium thin films <30 nm thick were prepared by pulsed laser deposition. X-ray diffraction investigations show that the Pd films are plastically deformed. Lattice strains are anisotropic and induced by the film growth mechanism as well as by the anisotropy of Young's modulus of palladium. In addition, a lattice contraction is observed near the surface. X-ray photoelectron spectroscopic analyses display a distinctive photoemission assigned to a less-ordered phase in addition to the common crystalline phase, which could be related to the grain boundaries. As a result, the electrochemical behavior of such Pd films clearly differs from that of common coarse-grained Pd. H-sorption and Pd oxide formation/removal processes greatly influence the subsequent film hydriding behavior, suggesting the occurrence of structural rearrangement/relaxation in the film. Hydride formation is favored when the film thickness decreases, which reflects the major role played by the subsurface layer on the hydriding process. The Pd films have a good stability upon hydrogen charge/discharge cycling which may be related to the lack of an abrupt α-to-β phase transition. (C) 2004 The Electrochemical Society.