Hydrotalcite-like compounds (HTlcs) are promising supports or catalyst precursors for heterogeneous catalysts. Herein, MgAl-HTlcs-supported Pd catalyst was fabricated, and two Pd catalysts supported on Mg(OH)₂ and Al(OH)₃ were prepared for comparison. The presence of hydroxyl groups (OH⁻) in the support is important for obtaining uniform Pd nanoparticles with small sizes. We found that Pdⁿ⁺ species are more active than Pd⁰ in low temperature CO oxidation due to their lower barrier in CO activation. The Pd/MgAl-HT catalyst shows the most stable Pdⁿ⁺ at a temperature lower than 90 °C, leading to the highest catalytic activity towards CO oxidation. Pdⁿ⁺ in the Pd/Al(OH)₃ catalyst is more stable than that in Pd/Mg(OH)₂ at low temperature, which is ascribed to its smaller temperature hysteresis (T_hysteresis) between the oxidation and re-reduction cycles. The effect of hydroxyl groups on stabilizing Pd species is related to the stability of Pd catalyst in CO oxidation reaction.