A rapid, one pot and biogenic fabrication of Pd nanoparticles is reported. Pd nanoparticles of size below 5nm size are synthesized using the dried leaf powder of Anacardium occidentale. Rapid reduction results in the formation of spherical particles. The nanoparticles are characterized by XRD, TEM, UV–visible and FTIR analysis. The absorption spectra have continua which are characteristic of Pd nanoparticles. The broad nature of the XRD pattern arising due to reflections from the (111), (200), (220), (311) and (222) planes indicate crystallinity of the nanoparticles with face centered cubic (fcc) structure. The morphology and shape of the nanoparticles are obtained by analyzing TEM images. Most of the nanoparticles are spherical with size in the range 2.5 and 4.5nm. FTIR spectra of dried Pd nanoparticles, native and treated dried leaf powder have been analyzed to find out the biomolecule responsible for the reduction of Pd 2+ and capping of the palladium nanoparticles. The possible mechanism of formation of the nanoparticles is suggested.