Mg-based laminate composites prepared by a repetitive-rolling method have a large hydrogen capacity as well as good kinetics and reversibility for hydrogen reaction. Mg/Pd laminate composite (Mg/Pd=6) can absorb a large amount of hydrogen up to 1.47 H/M (4 mass%), and desorb hydrogen reversibly at 573K. In this study, we investigated the mechanism of phase transition of the Mg/Pd laminate composites during hydrogenation/dehydrogenation by means of in-situ XRD measurements. In Mg/Pd laminate composite (Mg/Pd=6), the XRD profile of as-rolled sample indicated the existence of Mg and Pd within the detection ability of our XRD equipment. Mg6Pd intermetallic compound are formed during initial activation process. The Mg6Pd intermetallic compound can store hydrogen reversibly through the disproportionation and recombination processes.