High-performance electrodes with outstanding catalysts play a vital role in the commercial application of direct ethanol fuel cells. In the present study, a supported catalyst with controllable Pd loading, prepared using a facile impregnation method with sepiolite as a carrier, was synthesized and tested for electrocatalytic oxidation of ethanol. Physical characterization revealed the pore structure and large specific surface area of the sepiolite, which provided excellent conditions for the loading of nanometal clusters. The Pd-sepiolite had greater electrocatalytic ethanol activity and anti-intermediate product poisoning performance than a metallic Pd disc electrode under alkaline conditions. Under these experimental conditions, the electrochemical activity in terms of ethanol oxidation increased significantly with increasing Pd loading. Considering both the activity and stability of the electrodes, 23 wt.% Pd loading on sepiolite was selected with a coating amount of 140 μg cm–2 on glassy carbon. Factors such as ethanol/potassium hydroxide concentration, scanning rate and temperature had direct impacts on peak current densities as well as on reaction kinetics as depicted by Tafel plots. The electrochemical impedance test showed that Pd intercalation could improve significantly the conductivity of sepiolite and reduce the electron-transfer resistance in the electrocatalytic process. Thus, Pd-loaded sepiolite is a simple and effective catalyst for direct ethanol fuel cells.