In methane combustion, water tolerance of Pd-based catalysts is quite critical for stable performance, because water is produced in situ and a water-containing feed is used under real conditions. Herein, water-tolerant mesoporous silica-alumina (H-MSA) was prepared by solvent deficient precipitation (SDP) using triethoxy(octyl)silane (TEOOS) and aluminum isopropoxide (AIP). The H-MSA was more tolerant to water than γ-alumina, mesoporous alumina (MA), and mesoporous silica-alumina (MSA) synthesized by using tetraethyl orthosilicate (TEOS), because of the silica present on the external particle surface. Moreover, it exhibited better textural properties, leading to higher dispersion of PdOx. The PdOx catalyst supported on H-MSA was quite durable in repeated temperature-programmed cycles and isothermal tests in the presence of water vapor, compared to the reference PdOx catalysts. The measured stability was attributed to the water tolerance, weak Lewis acidity, and penta-coordinated Al species of the H-MSA support, which was preferentially imparted when TEOOS was added for substitution of 5 mol% AIP for the synthesis of H-MSA. Therefore, the SDP method employed herein is useful in endowing supported PdOx catalysts with the water tolerance necessary for stable methane combustion performance under wet conditions.