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Abstract Developing improved catalysts for sustainable chemical processes often involves understanding atomistic origins of catalytic activity, selectivity, and stability. Using density functional theory and steady‐state kinetic analyses, we probe the elementary steps that form decomposition products that limit selectivity in vinyl acetate (VA) synthesis on Pd surfaces covered with acetate species. Acetate formation and coupling with ethylene control the VA formation catalytic cycle and steady‐state coverage, but acetate and ethylene can separately decompose to form CO₂. Both decompositions involve initial C−H activations at acetate vacancies, followed by additional C−H activations and eventual C−O formations and C−C cleavages involving reactions with molecular oxygen. Acetate decomposition paths with non‐oxidative kinetically‐relevant steps exhibit similar free energy barriers to oxidative paths. In contrast, the non‐oxidative ethylene path involving an ethylidyne intermediate exhibits a much lower barrier than paths with oxidative kinetically‐relevant steps. Ethylene decomposition is very facile at low coverages but is more coverage‐sensitive, leading to similar decomposition and VA formation barriers at coverages accessible at steady state, which is consistent with moderate VA selectivity in measurements and ethylene vs. acetate decomposition contributions assessed from regressed kinetic parameters. These insights provide a detailed framework for describing VA synthesis rates and selectivity on metallic catalyst surfaces.