Methane upgrading into more valuable chemicals has received much attention. Herein, we report oxidative methane conversion to ethane using gaseous O-2 at low temperatures (<400 degrees C) and atmospheric pressure in a continuous reactor. A highly oxidized Pd deposited on ceria could produce ethane with a productivity as high as 0.84 mmol g(cat)(-1) h(-1). The Pd-O-Pd sites, not Pd-O-Ce, were the active sites for the selective ethane production at low temperatures. Density functional theory calculations confirmed that the Pd-O-Pd site is energetically more advantageous for C-C coupling, whereas Pd-O-Ce promotes CH4 dehydrogenation. The ceria helped Pd maintain a highly oxidic state despite reductive CH4 flow. This work can provide new insight for methane upgrading into C-2 species.