This study investigates the influence of palladium (Pd) doping on Cu/ZnO/ZrO2 catalysts for selective CO2 hydrogenation to CH3OH, combining comprehensive experimental characterizations with theoretical insights. The catalysts, synthesized with varying Pd loadings (0-3 wt.%), were evaluated across 210-250 degrees C. Catalytic performance analysis revealed that 2 wt.% Pd (CZZPd2) demonstrated superior CO2 conversion (22%) and methanol selectivity (64%) at 240 degrees C, achieving the highest methanol space-time yield (7.54 mmol/g.cat/hr). Characterization techniques, including XRD, XPS, TEM, CO2-TPD, and H2-TPR, highlighted the critical role of Pd in enhancing hydrogen spillover, stabilizing Cu active sites, and promoting optimal oxygen vacancy formation, which collectively facilitated intermediate stabilization and reduced the apparent activation energy (Ea = 52 kJ/ mol) for methanol synthesis. In-situ DRIFTS validated the stabilization of key reaction intermediates (formate and methoxide) on CZZPd2, correlating with its superior catalytic performance. DFT calculations provided atomic-level insights, illustrating the synergistic electronic interaction between Pd, Cu, and ZnO, which optimally lowers the energy barrier for CO2 activation and methanol formation. Excessive Pd loading (CZZPd3) led to particle agglomeration, disrupted metal-oxide interactions, and increased activation energy, reducing methanol selectivity. These findings highlight the important role of Pd in shaping the structure and electronic properties of the catalyst, making CZZPd2 as a benchmark catalyst for efficient and selective CO2 hydrogenation to methanol.