Pd nanoparticles have been generated by performing an electroless procedure on a mixed ceria (CeO2)/carbon black (Vulcan XC-72) support. The resulting material, Pd–CeO2/C, has been characterized by means of transmission electron microscopy (TEM), inductively coupled plasma atomic emission spectroscopy (ICP–AES), and X-ray diffraction (XRD) techniques. Electrodes coated with Pd–CeO2/C have been scrutinized for the oxidation of ethanol in alkaline media in half cells as well as in passive and active direct ethanol fuel cells (DEFCs). Membrane electrode assemblies have been fabricated using Pd–CeO2/C anodes, proprietary FeCo cathodes, and Tokuyama anion-exchange membranes. The monoplanar passive and active DEFCs have been fed with aqueous solutions of 10 wt % ethanol and 2 M KOH, supplying power densities as high as 66 mW cm−2 at 25 °C and 140 mW cm−2 at 80 °C. A comparison with a standard anode electrocatalyst containing Pd nanoparticles (Pd/C) has shown that, at even metal loading and experimental conditions, the energy released by the cells with the Pd–CeO2/C electrocatalyst is twice as much as that supplied by the cells with the Pd/C electrocatalyst. A cyclic voltammetry study has shown that the co-support ceria contributes to the remarkable decrease of the onset oxidation potential of ethanol. It is proposed that ceria promotes the formation at low potentials of species adsorbed on Pd, PdI-OHads, that are responsible for ethanol oxidation.