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A new concept of highly efficient and sulfur tolerant NOx reduction catalyst for diesel engines has been demonstrated. This catalyst has a double-layer construction and is composed of Pt and Rh as the precious metals, oxygen storage materials and some other catalytic components. Periodic lean/rich operation similar to the Lean NOx Trap catalyst was found to improve the highly efficient NOx reduction activity in a laboratory reactor test. As a result, this catalyst has the feature of high NOx reduction in a temperature window from 15°C to 35°C, and of high oxidation activity even in a lower temperature condition for HC and CO. Sulfur poisoning characteristics were also evaluated in a laboratory reactor test. The results showed that the proper desulfation procedure with a relatively low temperature environment enabled the stored sulfur to be reomved, and to maintain the NOx reduction efficiency for asignificantly long time period.