Abstract: Nanocrystalline palladium thin films deposited by electron-beam evaporation and deformed by on-chip tensile testing reveal a surprisingly large strain hardening capacity when considering the small similar to 25 nm grain size. The as-grown films contain several coherent single and multifold twin boundaries. The coherency of the twin boundaries considerably decreases with deformation due to dislocation/twin boundary interactions. These reactions are described based on a detailed analysis of the number and the type of dislocations located at the twin boundaries using high-resolution TEM, including aberration corrected microscopy. Sessile Frank dislocations were observed at the twin/matrix interfaces, explaining the loss of the TB coherency due to the Burgers vector pointing out of the twinning plane. Grain boundary mediated processes were excluded as a mechanism dominating the plastic deformation based on the investigation of the grain size distribution as well as the crystallographic texture using Automated Crystallographic Orientation Indexation TEM. Other factors influencing the plastic deformation such as impurities and the presence of a native passivation oxide layer at the surface of the films were investigated using analytical TEM. The twin boundaries observed in the present work partly explain the high strain hardening capacity by providing both increasing resistance to dislocation motion with deformation and a source for dislocation multiplication. (C) 2012 Elsevier Ltd. All rights reserved.