Perovskite-type oxides, containing Pd, were prepared via a combined sol-gel and combustion synthesis method and were characterized by X-ray diffraction (XRD). transmission electron microscopy (TEM), Xray photoelectron spectroscopy (XPS) and BET specific surface area (SSA). Their activity as three-way catalysts for the abatement of carbon monoxide, methane and nitrogen oxides, emitted from stoichiometrically operating natural-gas-fuelled vehicles, was investigated under simulated exhaust conditions. The preparation conditions concerning the complexing agent, the use of additives and the thermal treatment of the precursor solutions, were investigated. The La0.91Mn0.85Ce0.24Pd0.05Oz, and La1.034Mn0.966Pd0.05Oz phases were the most active. Their activation by high-temperature hydrothermal treatment was ascribed to the migration of Pd out of the perovskite lattice and the formation of segregated PdO. The role of Pd was crucial for the catalytic activity of the active phase. A low Pd content favored the dispersion of oxidized Pdx+, 2 <= x <= 4, and thus, enhanced catalytic activity. Oxidized Pdx+ with x > 2 appeared to be less active than Pd2+. The catalytic activity of La1.034Mn0.966Pd0.05Oz, increased significantly when 8 ppm SO2 were introduced in the reaction mixture. (C) 2008 Elsevier B.V. All rights reserved.