In this contribution, an eco-friendly, sustainable, and efficient palladium nanoparticle-decorated chitosan (Pd@Chitosan) catalyst was synthesized by a simple impregnation method. The synthesized material was utilized as a heterogeneous catalyst for the C-H arylation of benzothiazole under ultrasonic irradiation. The Pd@Chitosan catalyst efficiently catalyzed the conversion of aryl iodides and bromides to 1-(4-(benzothiazol-2-yl)phenyl)ethan-1-one selectively. A single product of 83–93% yield was obtained in N,N-dimethylformamide solvent at 80 °C for 2.5h. This study reveals that Pd@Chitosan is an efficient catalyst, which catalyzes the C-H arylation with good reaction yields. The activity of the Pd@Chitosan is due to the presence of highly dispersed Pd(0) nanoparticles on the surface of the chitosan and Pd2+; a tentative mechanism was proposed based on the XPS results of the fresh catalyst and spent catalyst.