The structurally well-defined intermetallic compound PdGa -a highly selective catalyst for the semi-hydrogenation of acetylene -was characterized by Fourier transform infrared spectroscopy (FTIR), in situ X-ray photoelectron spectroscopy (XPS) and in situ Prompt Gamma Activation Analysis (PGAA). A strong modification of the electronic states in PdGa compared to elemental Pd was revealed as well as the complete isolation of the Pd atoms on the surface of PdGa. In situ investigations proved the high stability of the surface, thus excluding segregation phenomena (common for alloys) or sub-surface chemistry involving C and/or H atoms (known for elemental Pd). By suppressing the sub-surface chemistry, the electronic modification as well as the site isolation lead to the high selectivity and long-term stability of PdGa in the semi-hydrogenation of acetylene.