We successfully synthesized Pd-CeO2 nanobundles in an anodic alumina template via occlusion electrodeposition for use during ethanol oxidation in alkaline ethanol fuel cells. As a result, well-ordered arrays of free-standing Pd-CeO2 nanobundles have an increased number of oxygen species on the surface, while the electrochemical active surface area remains relatively constant. Consequently, the electrocatalytic activity and stability of Pd-CeO2 nanobundles are dramatically enhanced in KOH and ethanol solution during ethanol oxidation compared to pure Pd prepared with no ceria suspension.