We have performed the first "high-pressure" XPS study on the palladium, hydrogen and olefin (trans-2-pentene) system in order to gain a better insight into the hydrogenation reaction. We report here data collected using a Pd(111) single crystal and a polycrystalline foil. Hydrogenation was observed on polycrystalline foil (RT and 373 K), but not on Pd(111) single crystal, revealed by on-line mass-spectrometry. We observed the reaction in the presence of huge amount of carbon (up to 73 %) in the information depth of XPS. On Pd(111) mainly graphite was present while other components C-H and C-Pd were also formed on the foil in much higher extent. C-Pd characterizes a carbon species in the interaction with palladium whereas C-H represents hydrogenated carbon including chemisorbed species. The d-band of the foil showed a remarkable up-shift towards E FERMI as compared to Pd(111). We concluded that both differences found in the valence and in C 1s region are indicators for different electronic structures that contribute to the variation in activity. The palladium foil lost its activity at elevated temperature (523 K), most probably due to desorption of hydrogen. Using additional UPS measurements we concluded that trans-2-pentene is hydrogenated in σ-bonded chemisorption modus, at least in UHV conditions.