Pd-Au bimetallic catalysts often display enhanced catalytic activities and selectivities compared with Pd-alone catalysts. This enhancement is often caused by two alloy effects, i.e., ensemble and ligand effects. The ensemble effect is a dilution of surface Pd by Au. With increasing surface Au coverage, contiguous Pd ensembles disappear and isolated Pd ensembles form. For certain reactions, for example vinyl acetate synthesis, this effect is responsible for reaction rate enhancement via the formation of highly active surface sites, e.g., isolated Pd pairs. The disappearance of contiguous Pd ensembles also switches off side reactions catalyzed by these sites. This explains the selectivity increase of certain reactions, for example direct H(2)O(2) synthesis. The ligand effects are electronic perturbation of Pd by Au. Via direct charge transfer or by affecting bond lengths, the ligand effects cause the Pd d band to be more filled, moving the d-band center away from the Fermi level. Both changes make Pd more "atomic like" therefore binding reactants and products more weakly. For certain reactions, this eliminates a so-called "self-poisoning" effect and enhances activity/selectivity.