Pd-Cu alloy membranes were prepared by electroless plating on porous stainless steel (PSS) support. Sol-gel derived ceria was introduced as the intermediate layer by a sol-dip-coating method to prevent intermetallic diffusion and to enhance the affinity between the support and membrane. High temperature permeation was carried out from 573 K to 773 K with a pressure difference of 1 atm. Properly prepared ceria layer was effective as the diffusion barrier in the temperature range examined, which is suitable for water-gas shift reaction. The hydrogen permeation flux through Pd-Cu/CeO2/PSS was lower than that of pure Pd membrane obtained in a previous study under the same conditions. The adsorptive properties of Pd in Pd-Cu system were affected by the alloying effect where H2 could be assumed to adsorb and dissociate mainly on Pd atoms. The Cu atoms in the composite membrane were non-effective for hydrogen dissociative adsorption on the surface of membrane. This is an abstract of a paper presented at the 2009 AIChE Spring National Meeting and 5th Global Congress on Process Safety (Tampa, FL 4/26-30/2009).