Identification of metal cluster catalysis is a topic that is being investigated since a long time. Here, we report a Pd₃ metal cluster catalytic reaction investigated by means of operando studies. We discovered that atomically defined tri-nuclear palladium (Pd₃) is a surprisingly active catalyst for the cycloisomerization of 2-phenylethynylaniline. Operando ¹H NMR spectroscopy and X-ray extended absorption fine structure (EXAFS) measurements have indicated that the structural integrity of such a catalyst remains intact throughout the reaction, which has also been confirmed by an ex situ X-ray photoelectron spectroscopy (XPS) study and catalyst recycling experiments. Kinetic data derived from operando IR spectroscopy measurements have shown that Pd₃ is the active catalytic species. Density functional theory calculations have revealed a reaction pathway consistent with the kinetic data, further supported by NMR titration and X-ray crystal structure studies. Overall, the present study presents a clear example of metal cluster catalysis.