AbstractIn this article we finalize our experimental and theoretical studies on the (η2‐C60)Pd(PPh3)2 palladium–phosphine fullerene complex. Full scale ab initio quantum‐chemical calculations up to the B3LYP/SDDALL level of theory have been performed to determine the structure and electronic spectrum of (η2‐C60)Pd(PPh3)2. Based on the results of calculations and experimental data we conclude that the preliminary interaction of the catalyst with the substrate facilitates the interaction of the substrate–catalyst complex with H2 by decreasing the energy barrier. In conclusions we summarize the results of our studies of the structure and electronic spectrum of the investigated complex, the kinetics of catalytic reactions, the influence of the solvents on the catalyst's activity in the heterogeneous phase, and provide the possible mechanism of catalytic reaction. © 2004 Wiley Periodicals, Inc. Int J Quantum Chem, 2004