Developing highly active, stable, and economic electrocatalysts for sustainable hydrogen (H₂) production is crucial for efficient water electrolysis. In this study, a highly effective and affordable electrocatalyst for hydrogen evolution was developed using an easy and straightforward one-step hydrothermal method for in situ doping of Pd into the lattice of MoS₂. The physico-chemical and electrochemical properties of the as-prepared Pd-doped MoS₂ systems were thoroughly studied. After Pd was doped into the MoS₂ lattice, sulfur vacancies were induced, which led to a phase change from the semiconducting (2H) to the metallic (1T) phase of MoS₂. These changes altered the material's morphology and optimized its electronic structure, making it a superior electrocatalyst for water splitting. The electrocatalytic activity of a cathode prepared via drop-casting using Pd–MoS₂ nanostructured powder for HER applications was studied in acidic water, alkaline water, and simulated sea water. In order to attain a current density of 10 mA cm⁻² during HER application, nanostructured Pd–MoS₂ exhibited greater electrocatalytic activity in acidic conditions with an overpotential of only 89 mV vs. RHE (acidic) compared to 149 mV vs. RHE (alkaline) and 165 mV vs. RHE (simulated sea water). Moreover, in acidic, alkaline, and simulated sea water, Pd–MoS₂ demonstrated superior activity during electrocatalytic water splitting and low cell potentials of +1.98, +2.03, and +2.18 V, respectively. This study demonstrates that Pd doping makes MoS₂ a promising candidate for the HER and electrocatalytic water splitting compared to expensive metals.