Hydrogen holds great promise as a cleaner alternative to fossil fuels, but its efficient and affordable storage remains a significant challenge. Bimetallic systems, such as Pd and Ni, present a promising option for storing hydrogen. In this study, using the combination of different cutting-edge X-ray and electron techniques, we observed the transformations of Pd-Ni nanoparticles, which initially consist of a NiO-rich shell surrounding a Pd-rich core but undergo a major transformation when they interact with hydrogen. During hydrogen exposure, the Pd core breaks into smaller pockets, dramatically increasing its surface area and enhancing the hydrogen storage capacity, especially in nanoparticles with lower Pd content. The findings provide a deep understanding of the morphological changes at the atomic level during hydrogen storage and contribute to designing cost-effective hydrogen storage using multimetallic systems.