In order to bridge the `material gap' in heterogeneous catalysis it is shown that supported model catalysts can be used. They are prepared by epitaxial growth on an oxide single crystal. This work describes results obtained with Pd clusters supported on MgO(100) surfaces as a model catalyst for the reduction of NO by CO. The morphology of the Pd particles was analysed by transmission electron microscope. By using molecular beam techniques it was possible to determine the elementary steps of the reaction and the reaction mechanism. It is shown that the dissociation of NO is the key step for the reaction. After dissociation, two types of adsorbed nitrogen atom are obtained: a strongly bound one that does not desorb during the reaction and a loosely bound one that desorbs associatively. Oxygen atoms resulting from the NO dissociation react with adsorbed CO or diffuse in the lattice of the Pd particles. The reaction rate depends on both the particle size and the particle morphology. The reaction kinetics is also influenced by the support via the capture, by the metallic particles, of the reactants physisorbed on the support.