Fe–Ni catalysts present high activity in dry reforming of methane, with high carbon resistance, but suffer from deactivation via sintering and Fe segregation. Enhanced control of the stability and activity of Fe–Ni/MgAl₂O₄ was achieved by means of Pd addition. The evolution of the catalyst structure during H₂ Temperature Programmed Reduction (TPR) and CO₂ Temperature Programmed Oxidation (TPO) was investigated using time-resolved in situ X-ray diffraction (XRD). During reduction of Fe–Ni–Pd supported on MgAl₂O₄, a core shell alloy forms at the surface, where Fe–Ni is in the core and Fe–Ni–Pd in the shell. A 0.2 wt% Pd loading or Ni:Pd molar ratio as high as 75:1 showed the best performance in terms of both activity and stability of the catalyst at 1023 K and total pressure of 101.3 kPa. Experimental results and DFT calculations showed that Pd addition to bimetallic Fe–Ni reduces the tendency of Fe to segregate to the surface of the alloy particles under methane dry reforming (DRM) conditions, due to the formation of a thin Fe–Ni–Pd surface layer. The latter acts as a barrier for Fe segregation from the core. Segregation of Fe from the trimetallic shell still occurs, but to a lesser extent as the Fe concentration is lower. This Ni:Pd molar ratio is capable of controlling the carbon formation and hence ensure high catalyst activity of 24.8 mmol s⁻¹ g_metals⁻¹ after 21 h time-on-stream.