A new catalyst composed of Pd nanoparticles supported on MgO has been prepared by the room temperature NaBH₄ reduction of Na₂PdCl₄ in methanol in the presence of the support. TEM measurements reveal well-dispersed Pd particles of mean diameter 1.7 nm attached to the MgO surface. Further characterization was achieved by ICP-AES, XPS, XRD, H₂ pulse chemisorption and H₂-TPR. The new catalyst is efficient for the regioselective hydrogenation of the heterocyclic ring of quinolines, as well as for the mild reduction of a variety of alkenes representative of fuel components, and the partial saturation of biodiesel. The new material is considerably more reactive than commercial Pd/SiO₂ and Pd/Al₂O₃ catalysts under analogous reaction conditions.