A bimetallic, palladium-nickel (Pd-Ni) stable colloidal nanocatalyst was synthesized by a wet-chemical reduction technique using Aerosol OT (AOT) as the surfactant and hydrazine hydrate as a reducing agent. The particle size of a colloidal nanocatalyst was controlled by varying precursor concentration, reducing agent, and surfactant concentration. The particle size and morphology of the colloidal catalyst were investigated by dynamic light scattering (DLS) and transmission electron microscopy (TEM), respectively. TEM images show the actual particle size of PdNi nanocatalysts to be in the range of 1028nm at 10mM concentration of AOT and hydrazine hydrate. The activity of the colloidal catalyst (bimetallic) was evaluated for reduction of nitro aromatic compounds which includes 4-NP, 3-NP, 2-NP, 4-nitrobenzo-15-crown, and 4-NA. The rate constant of the Pd-Ni colloidal nanocatalyst indicates that the activity of bimetallic catalysts was higher than the monometallic catalyst for various nitro compounds. The rate constant of 4-nitrophenol was found to be approximate to 61x10(-2)min(-1) at room temperature.