The (110) surface of the InPd intermetallic compound and the In–Pd surface alloy properties are investigated in the framework of the density functional theory, within the projector augmented plane-wave method. Surface segregation is calculated to be energetically unfavorable at stoichiometric InPd(110) surfaces, while indium antisites are shown to segregate to the surface in off-stoichiometric InPd(110) systems. Concerning surface alloys obtained by burying In-doped Pd layers in Pd(111), we demonstrated that the most stable ones are those presenting atomic indium concentrations below 50 at. % (11 at. %, 25 at. %, 33 at. %). According to our calculations, the In-doped Pd layers with concentration above or equal to 50% lead to In-doped Pd multilayers, each presenting an atomic indium concentration below 50 at. %. Alloying and segregation effects in InPd intermetallic compound and In–Pd surface alloys clearly agree with the larger bonding strength of In–Pd (−0.44 eV) compared to In–In (−0.29 eV) and Pd–Pd (−0.31 eV).