We use differential extended X-ray absorption fine structure (Δ-EXAFS) to monitor the Ar-induced surface restructuring of silica-supported Pd nanoclusters (1 nm diameter) at 77 K. Δ-EXAFS analysis shows 9 ± 2 nearest-neighbor Pd-Pd bonds expand by 0.104 ± 0.005 Å as a result of Ar adsorption. Atomistic molecular dynamics simulations provide evidence for a model in which Ar drives restructuring of under-coordinated Pd atoms, leading to an increased Pd-Pd bond length of surface Pd atoms with no change in overall nearest-neighbor Pd-Pd coordination number. Based on observations from the atomistic simulations, it is likely that under-coordinated atoms are trapped in metastable states at 77 K and Ar provides the kinetic energy needed to overcome the barrier for surface restructuring. Together, experiment and theory highlight the ability of Δ-EXAFS to probe surface atoms of Pd nanoclusters.