A significant issue related to Palladium (Pd) based catalysts is that sulfur-containing species, such as alkanethiols, can form a PdSx underlayer on nanoparticle surface and subsequently poison the catalysts. Understanding the exact reaction pathway, the degree of sulfidation, the chemical stoichiometry, and the temperature dependence of this process is critically important. Combining energy-filtered transmission electron microscopy (EFTEM), X-ray diffraction (XRD), and X-ray absorption spectroscopy experiments at the S K-, Pd K-, and L2,3-edges, we show the kinetic pathway of Pd nanoparticle sulfidation process with the addition of excess amount of octadecanethiol at different temperatures, up to 250 °C. We demonstrate that the initial polycrystalline Pd-oleylamine nanoparticles gradually become amorphous PdSx nanoparticles, with the sulfur atomic concentration eventually saturating at Pd/S = 66:34 at 200 °C. This final chemical stoichiometry of the sulfurized nanoparticles closely matches that of the crystalline P16S7 phase (30.4% S), albeit being structurally amorphous. Sulfur diffusion into the nanoparticle depends strongly on the temperature. At 90 °C, sulfidation remains limited at the surface of nanoparticles even with extended heating time; whereas at higher temperatures beyond 125 °C, sulfidation occurs rapidly in the interior of the particles, far beyond what can be described as a core-shell model. This indicates sulfur diffusion from the surface to the interior of the particle is subject to a diffusion barrier and likely first go through the grain boundaries of the nanoparticle.