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Palladium catalysts are known to show higher methane oxidation performance than platinum and/or rhodium catalysts. In this paper, the higher oxidative dehydrogenation activity on palladium is proposed as a reason for the superior methane oxidation. When other oxidation reactions are considered, higher affinity of palladium to oxygen has also been suggested[1]. In this study, oxygen chemical potential on platinum and palladium catalyst surfaces under oxidation conditions was measured using a specially designed electrochemical sensor. The oxygen chemical potential was calculated from the sensor potential by the Nernst equation. As a result, oxygen potential on palladium during the methane oxidation reaction was found to be much higher than that of platinum, correlating with affinity to oxygen and higher methane oxidation performance. The rate of oxygen adsorption and desorption on platinum and palladium was evaluated in an engine experiment using a dual lambda-sensor procedure.