Herein, we report the in situ generation of poly(N-vinyl-2-pyrrolidone) (PVP)-stabilized palladium(0) nanoclusters and their catalytic activity in hydrogen generation from the methanolysis of ammonia-borane (AB). The PVP-stabilized palladium(0) nanoclusters with an average particle size of 3.2 +/- 0.5 nm were formed from the reduction of palladium(II) acetylacetonate during the methanolysis of AB in the presence of PVP at room temperature. The palladium(0) nanoclusters are highly stable in solution for extended periods of time, can be isolated as solid materials, are redispersible in methanol and show catalytic activity after redispersion. The nanoclusters were characterized by TEM, XPS, FTIR, UV-Vis, XRD, and SAED techniques. Mercury poisoning experiments indicate that PVP-stabilized palladium(0) nanoclusters are heterogeneous catalysts in the methanolysis of ammonia-borane. The PVP-stabilized palladium(0) nanoclusters are highly active and stable catalysts as they provide 23 000 turnovers in hydrogen generation from the methanolysis of AB over 27 h before deactivation at room temperature. A kinetic study shows that the catalytic methanolysis of AB is first order with respect to catalyst concentration and zero order with respect to substrate concentration. The activation energy of the methanolysis of AB catalyzed by PVP-stabilized palladium(0) nanoclusters was determined to be E-a = 35 +/- 2 kJ mol(-1).