The mechanism of hydrogen recombination on a Pd(111) single crystal and well-defined Pd nanoparticles is studied using pulsed multi-molecular beam techniques and the H2/D2 isotope exchange reaction. The focus of this study is to obtain a microscopic understanding of the role of subsurface hydrogen in enhancing the associative desorption of molecular hydrogen. HD production from H2 and D2 over Pd is investigated using pulsed molecular beams, and the temperature dependence and reaction orders are obtained for the rate of HD production under various reaction conditions designed to modulate the amount of subsurface hydrogen present. The experimental data are compared to the results of kinetic modeling based on different mechanisms for hydrogen recombination. We found that under conditions where virtually no subsurface hydrogen species are present, the HD formation rate can be described exceptionally well by a classic Langmuir–Hinshelwood model. However, this model completely fails to reproduce the experimentally observed high HD formation rates and the reaction orders under reaction conditions where subsurface hydrogen is present. To analyze this phenomenon, we develop two kinetic models that account for the role of subsurface hydrogen. First, we investigate the possibility of a change in the reaction mechanism, where recombination of one subsurface and one surface hydrogen species (known as a breakthrough mechanism) becomes dominant when subsurface hydrogen is present. Second, we investigate the possibility of the modified Langmuir–Hinshelwood mechanism with subsurface hydrogen lowering the activation energy for recombination of two hydrogen species adsorbed on the surface. We show that the experimental reaction kinetics can be well described by both kinetic models based on non-Langmuir–Hinshelwood-type mechanisms.