A series of sulfated zirconia supported Pd/Co catalysts was synthesized by the sol-gel method and examined for NO, reduction by methane. The NO conversion increased up to a Co/S ratio of 0.43, and then decreased at a higher Co loading (Co/S = 0.95). Sulfate content was also essential for obtaining high selectivity to molecular nitrogen. A catalyst loaded with 0.06 wt.% Pd, 2.1 wt.% Co and 2.1 wt.% S (Pd/Co-SZ-2) exhibited remarkable performance under lean conditions and displayed stability in a long-term durability test using a synthetic reaction mixture containing 10% water vapor. This catalyst exhibited the highest sulfur retention most probably as cobalt sulfide. Besides, the catalytic oxidation of NO to NOy groups was confirmed by FT-IR, in agreement with the general mechanism for the SCR of NO by hydrocarbons. In the absence of oxygen in the feed stream, the catalyst was highly active for NO reduction with methane. IR stretching bands assigned to N2O and adsorbed nitro groups were identified upon adsorbing NO on Pd/Co-SZ-2. This indicates that under rich conditions disproportionation of NO to N2O and NO2 occurs and confirms that the formation of NO2 species is an essential step for NO reduction by CH4. (c) 2004 Elsevier B.V. All tights reserved.