In this paper we present the results of the investigations of nanostructured C-Pd films for hydrogen sensing applications. These C-Pd films were prepared by physical vapor deposition and then annealed in an argon flow at the temperature of 500°C. The structure and morphology of the prepared C-Pd films were investigated using transmission electron microscopy and energy dispersive X-ray spectroscopy. We studied the infiuence of hydrogen on the electrical properties and crystal structure of C-Pd films. It was shown that film resistance changes depended on hydrogen concentration. At lower hydrogen concentration (up to 2 vol.%), the films response increased proportionally to [H2], while above 2 vol.% H2, it was almost constant. This is connected with the formation of a solid solution of hydrogen in palladium at lower H2 concentration and the creation of palladium hydride at higher H2 concentration. X-ray diffraction was used to confirm the formation of Pd-H solid solution and palladium hydride.