The electronic structure and bonding at a Fe( 110) - Pd( 100) interface was theoretically analyzed in the framework of semi-empirical quantum chemical calculations. The Fe - Pd interface was modeled by a Fe74Pd74 cluster and a Fe - Pd six layer slab. The extended Huckel tight binding (EHTB) method and its modifications, including repulsive interactions, were used to calculate the interfacial adhesion and the H-absorption energy. The energetic minimum position for H is found at the Fe - Pd interface closer to the Pd layer. The interfacial Fe - Pd distance result to be 1.73 angstrom where Fe -Pd develops a strong bonding interaction. An important metal - metal adhesion was also found. The changes in the Density of States ( DOS) and the Crystal Orbital Overlap Population ( COOP) were compared in different structures: clusters, slab and two types of Fe - Pd alloys. The H as an impurity is responsible for a Fe - Fe and Pd - Pd bond weakening. However, the H effect is much less detrimental for the Fe -Pd bonds at the interface. When H is located at interstitial sites in bulk Fe - Pd alloys, the Pd - Pd overlap population shows a notorious decrease in the case of fcc structures while for fct structures the change is only 12%. The intermetallic bonding was also weakened as compared with the pure alloys. The objective of this work is to bring a plausible explanation to the null permeability to hydrogen in Pd-coated Fe films. (C) 2005 Springer Science + Business Media, Inc.