Zeolites HY modified with palladium (0.05-2.5 wt.%) were found to be active and selective catalysts in the process of the selective oxidation of ammonia to nitrogen (NH3-SCO). Parent zeolite and its modifications with palladium were investigated with regard to their structural, textural, and redox properties. The IR spectroscopy, X-ray diffraction, and BET methods were employed for these purposes. Correlation between loading and aggregation of Pd-species deposited on zeolites and their activity and selectivity in the NH3-SCO process was found. Studies of adsorption forms of ammonia and product of its conversion done by IR spectroscopy as well as catalytic tests performed with various space velocities gave insight into the reaction mechanism. Zeolite Y modified with palladium is an interesting catalyst of selective ammonia oxidation for potential application in diesel car exhaust gas purification system.