Carbon-supported PdNi catalysts for the ethanol oxidation reaction in alkaline direct ethanol fuel cells are successfully synthesized by the simultaneous reduction method using NaBH4 as reductant. X-ray diffraction characterization confirms the formation of the face-centered cubic crystalline Pd and Ni(OH)2 on the carbon powder for the PdNi/C catalysts. Transmission electron microscopy images show that the metal particles are well-dispersed on the carbon powder, while energy-dispersive X-ray spectrometer results indicate the uniform distribution of Ni around Pd. X-ray photoelectron spectroscopy analyses reveal the chemical states of Ni, including metallic Ni, NiO, Ni(OH)2 and NiOOH. Cyclic voltammetry and chronopotentiometry tests demonstrate that the Pd2Ni3/C catalyst exhibits higher activity and stability for the ethanol oxidation reaction in an alkaline medium than does the Pd/C catalyst. Fuel cell performance tests show that the application of Pd2Ni3/C as the anode catalyst of an alkaline direct ethanol fuel cell with an anion-exchange membrane can yield a maximum power density of 90mWcm−2 at 60°C.