Gas sensors based on a noble metal–semiconductor are widely used, and they show a positive temperature response to hydrogen below 400 °C. In this study, a catalytically activated hydrogen sensor is obtained based on Pd decorated WO₃ nanoplates constructed by a solvothermal method. An insight into the role of Pd catalyst in the outstanding performance is provided by comparing the sensing properties of this sensor with those of a traditional one made from the same pristine WO₃. The pure WO₃ sensor exhibits poor selectivity and low sensitivity to hydrogen. In contrast, the observed response of the as-produced sensor is up to 843 at a low operating temperature of 80 °C; the response value is even greater than that of WO₃ sensors at high temperatures (250–400 °C). In addition, the Pd-loaded WO₃ sensors show excellent selectivity towards H₂ in comparison to other common gases (CH₄, C₃H₆O, C₂H₆, C₃H₈O and NH₃). The significantly improved performance is thoroughly explained in terms of the adsorption–desorption mechanism and chemical kinetics theories. Furthermore, an interfacial model demonstrated in this report indicates that the interfacial barrier between WO₃ nanoparticles can be a novel effect for excellent gas sensing performance.