[reactions: see text] Palladium hydroxide on carbon (Pearlman's catalyst) effectively catalyzes direct arylation reactions of aryl iodides and bromides, providing excellent arylation-to-hydrodehalogenation ratios (>30:1) with broad scope for both intra- and intermolecular arylation processes. Studies aimed at determining the nature of the active catalyst indicate that an active homogeneous palladium species is produced under the reaction conditions.