In the heterogeneous catalyst i-Pd(OAc)2(TPPTS)2, Pd(II) was reduced to Pd(0) by using different alcohol solvents, and the catalyst’s activity was studied in the aerobic oxidation of benzyl alcohol. We studied the effects of the impregnation time in ethanol as a solvent and the use of various alcoholic solvents on the size of palladium nanoparticles. We found that the reduction of palladium by the various alcohols yielded palladium nanoparticles that were active in the aerobic oxidation of benzyl alcohol. As determined by DLS, TEM, and zeta potential analyses, both the impregnation time in ethanol and the type of alcohol used were observed to affect nanoparticle formation, particle size distribution, and agglomeration, as well as the conversion rate. The palladium nanoparticles’ hydrodynamic diameter sizes obtained during the 24 h of impregnation time were in the range of 10–200 nm. However, following 24 h of impregnation in ethanol the nanoparticles tended to form aggregates. The conversion rates of all the primary alcohols were similar, while for secondary alcohol, in which the hydrogen of the hydroxyl is less acidic and there is steric hindrance, the conversion was the lowest. Performing the oxidation using the solvent 1-propanol yielded smaller nanoparticles with narrower distributions in comparison to the reaction that was observed when using the ethanol solvent. On the other hand, the relatively high particle size distribution in 1-hexanol yielded agglomerates.