The CO dissociation probability on transition metals is often invoked to explain the product distribution (selectivity) of catalytic CO hydrogenation. Along these lines, we have investigated CO adsorption and dissociation on smooth and ion-bombarded Pd(1 1 1) at pressures up to 1 mbar using vibrational sum frequency generation (SFG) and X-ray photoelectron spectroscopy (XPS). Under high pressure, CO adsorbate structures were observed that were identical to high-coverage structures in UHV. On ion-bombarded surfaces an additional species was detected which was attributed to CO bridge bonded to defect (low-coordinated) sites. On both surfaces, no indications of CO dissociation were found even after hours of 0.1 mbar CO exposure. However, exposing CO/H-2 mixtures to ion-bombarded Pd(1 1 1) produced carbonaceous deposits suggesting CHxO species as precursors for C-O bond cleavage and that the formation of CHxO is facilitated by surface defects. The relevance of the observations for CO hydrogenation on Pd catalysts is discussed. (C) 2004 Elsevier B.V. All rights reserved.