The hydrogenation mechanism of Pd thin films was analyzed in real time by measuring the variation in ellipsometric Ψ and Δ using in situ spectroscopic ellipsometry. In the initial stage, the hydrogenation proceeded from the film surface and a mixture layer of metal and hydride, not a uniform hydride layer, was formed at the surface. With time evolution, the thickness of the mixture layer increased and that of the Pd metal layer decreased rapidly. After the whole Pd metal layer changed to the mixture layer, the concentration of hydride in the mixture layer increased. Finally, the concentration reached one and hydrogenation of Pd was finished.