Platinum-modified aluminide coatings have shown increased resistance to high-temperature corrosion. The high price of platinum metal has motivated investigations of the potential for palladium-modified aluminide coatings. In this paper, we have shown that the poor hot corrosion resistance of Pd-AI coatings reported in the literature was mainly due to inadequate processing, leading to significant incorporation of hydrogen into the coating and the subsequent formation of pores and blisters. This can be avoided by replacing a pure palladium predeposit by a Pd-2Owt. %Ni alloy predeposit in which hydrogen is far less soluble. By this new technique, Pd-Ni-modified aluminide coatings of the inward and outward type were obtained on INIO0. Their structure consists of a single fl(Pd, Ni)-Al phase, with a strong palladium concentration gradient across the coating thickness. The composition in the outer part of the coating corresponds to (Nio.4, Pdo.6)-Al. Corrosion tests were performed on these coatings at 850 Β°C in air and in air + 0,01% SOe, with periodic NaeS04 contamination (0.5mg cm e every 50 1 h cycles). All palladium-containing coatings showed an excellent resistance to this environment (lifetime greater than I000 cycles). Cyclic oxidation tests performed at 1100 Β°C also showed a beneficial effect of palladium on the protective Ale03 scale integrity and *Invited paper.