Pd layers of thickness from a fraction to several monolayers (ML), deposited at room temperature (RT) on Nb(0 0 1) surface, are annealed from 400 to 2150 K. Changes of composition, atomic and electronic structure, caused by annealing, have been studied using low-energy electron diffraction (LEED), Auger electron spectroscopy (AES) and contact potential measurement (CPD). Up to 2.8 ML the growth of Pd films is isomorphous with the substrate. Above this coverage, hcp palladium domains are formed with the orientation {11 (2) over bar0}Pdparallel to{001}Nb and <0001>Pdparallel to<011>Nb, and the stacking sequence AB\AB1, etc. along the [0001] direction. The work function (WF) of the <11 (2) over bar0>Pd film amounts to 5.2 eV. For the annealing temperature from 600 to 900 K, beginning from coverage 6.8 ML, the Pd adlayer undergoes phase transition to another hcp structure with the stacking sequence ABAC\ABAC\, etc. For coverage higher than 1 ML, intermixing becomes noticeable above 700 K. After annealing at higher temperatures, surface alloy formation is observed in the entire coverage range studied, 0.5-9.5 ML. The alloy has a (1 x 1) lateral structure with reference to Nb(001). The topmost layer of the alloy consists of Pd atoms and the work function amounts to 4.8 +/- 0.1 eV (C) 2003 Elsevier B.V. All rights reserved.