Segregation energies of isolated Pd in PdAu(1 1 1) alloy are investigated by DFT calculations as a function of the oxygen coverage. Segregation of Pd is found to be oxygen-coverage dependent. While for 'clean' PdAu(1 1 1), Pd prefers to be in the bulk, in the presence of more than 1/3 ML of oxygen, Pd meanly segregates to the surface. The analysis of Pd d-band provides evidence of strong Pd-O affinity. The understanding of such behaviour is of interest in the field of heterogeneous catalysis because of the lack of information about the surface ordering in bimetallic alloys in the presence of reactive gas. (C) 2010 Elsevier B. V. All rights reserved.