Hydrothermally stable diesel oxidation catalysts (DOCs) with improved low-temperature activity are desired for the abatement of emissions from diesel vehicles. Herein, novel palladium(Pd)/SiO2(core)@Zr(shell) structured DOCs were developed. SiO2 was completely covered by an 8.4 nm thickness Zr-based shell using a hard template method. The SiO2@Zr support was decorated by Pd and evaluated under a simulated diesel exhaust stream. Degreened 1 wt% Pd/SiO2@Zr achieved 90% CO and total hydrocarbon conversion at 178 and 372 °C, respectively (feed: 6% CO2, 12% O2, 6% H2O, 400 ppm H2, 2000 ppm CO, 100 ppm NO, 1667 ppm C2H4, 1000 ppm C3H6, 333 ppm C3H8; HCs in C1 basis and GHSV = 113,000 h−1). After hydrothermal aging, only a minor deactivation was observed, while the surface area of 1 wt% Pd/SiO2@Zr was as high as 104 m2/g. The hydrothermal stability of 1 wt% Pd/SiO2@Zr was attributed to the poor crystallinity of SiO2@Zr, possibly due to the formation of Si-O-Zr bonds. This work highlights the promising potential of utilizing durable Pd/SiO2@Zr catalysts for diesel oxidation applications.