The preparation of colloidal Pd nanoparticles using an ethanolamine- modified polyol process is described. The Pd nanoparticles are prepared from reduction of Pd(OAc)2 by ethanolamine at room temperature. The Pd nanoparticles were separated from the suspension by centrifugation or gravity sedimentation. The x-ray diffraction analysis (XRD) showed that the EtOH-produced Pd nanoparticles are large aggregates. It was also observed that a hydrocarbon steric layer is adsorbed onto the particle surface.