Microbial reduction of perchlorate (ClO4-) is emerging as a cost-effective strategy for groundwater remediation. However, the effectiveness of perchlorate reduction can be suppressed by the common co-contamination of nitrate (NO3-). We propose a means to overcome the limitation of ClO4- reduction: depositing palladium nanoparticles (Pd0NPs) within the matrix of a hydrogenotrophic biofilm. Two H2-based membrane biofilm reactors (MBfRs) were operated in parallel in long-term continuous and batch modes: one system had only a biofilm (bio-MBfR), while the other incorporated biogenic Pd0NPs in the biofilm matrix (bioPd-MBfR). For long-term co-reduction, bioPd-MBfR had a distinct advantage of oxyanion reduction fluxes, and it particularly alleviated the competitive advantage of NO3- reduction over ClO4- reduction. Batch tests also demonstrated that bioPd-MBfR gave more rapid reduction rates for ClO4- and ClO3- compared to those of bio-MBfR. Both biofilm communities were dominated by bacteria known to be perchlorate and nitrate reducers. Functional-gene abundances reflecting the intracellular electron flow from H2 to NADH to the reductases were supplanted by extracellular electron flow with the addition of Pd0NPs.