CO oxidation reaction mechanisms and energetics are examined on adsorbed Pd-4 and Rh-4 clusters and adsorbed Pd and Rh atoms on CeO2 and Ce0.75Zr0.25 O-2 support structures using DFT methods. Activation barriers and TS structures are computed with CI-NEB method. On cluster adsorbed systems, Zr affects CO binding position and O-2 adsorption mode. Energetically, formation of two CO2 molecules without barrier and surface regeneration is possible only on Pd-4-CeO2 surface. With metal atom substituted surfaces, Pd substituted Ce0.75Zr0.25O2 and CeO2 supports are found to be capable of completing catalytic cycle with consecutive CO oxidations by creating and filling surface oxygen vacancies. (C) 2013 Elsevier B.V. All rights reserved.