Ultrafine palladium nanoparticles (Pd NPs) supported on carbon nanospheres have been successfully synthesized using a facile methanol-mediated weakly-capping growth approach (WCGA) with anhydrous methanol as a mild reductant and a weakly capping agent. The Pd NPs show exceedingly high catalytic activity for 100% selective dehydrogenation of aqueous formic acid (FA) at ambient temperatures. The small size and clean surface of the Pd NPs greatly improve the catalytic properties of the as-prepared catalyst, providing an average rate of CO-free H2 generation up to 43 L H2 gPd(-1) min(-1) and a turnover frequency (TOF) of 7256 h(-1) at 60 °C. These values are much higher than those obtained even with the most active catalyst reported thus far for heterogeneously catalyzed dehydrogenation of FA. This remarkably facile and effective methanol-mediated WCGA provides a powerful entry into ultrafine metal NPs with clean surface to achieve enhanced performance. Moreover, the catalytic results open up new avenues in the effective applications of FA for hydrogen storage.