Abstract: We report a new mode of precipitation in a B19 martensitic Ti50Ni30Pd20 shape memory alloy consisting of a central Ti2Ni(Pd) precipitate surrounded by an austenite area containing Ti2Pd(Ni) precipitates. The morphology and crystallography of the precipitation area is investigated using conventional and high resolution electron microscopy. In particular, the orientation relationship and the coherency strain between the Ti2Pd(Ni) precipitate and the surrounding retained B2 matrix are discussed. A study of local composition in relation with a ternary phase diagram using X-ray energy dispersive spectroscopy with a nanoprobe gives evidences of the formation mechanism.