Abstract: Pd-rich PGM (platinum-group minerals) have been found in sulphide-bearing dunites and harzburgites from the Inazumi-yama ultramafic complex in southwestern Japan. In the dunite, potarite (PdHg0.85–0.88) is the most abundant PGM but other associated PGM include stibiopalladinite (Pd5Sb2) and rare sperrylite (PtAs2) and Pd-rich alloys. A Pd telluride has been found in the harzburgite. The PGM are enclosed usually by pentlandite-heazlewoodite composite grains and, rarely, by altered chrome-spinel. These minerals are characteristic of an ultramafic assemblage but they are accompanied by ubiquitous galena and minor sphalerite not usually associated with these ultramafic assemblages. The ultramafic part of this complex has been thermally metamorphosed (olivine-talc zone) within the contact aureole of an adjacent granite. The PGM, sulphides and altered spinel are all intergrown with antigorite and/or chlorite, indicating a metamorphic overprint on the primary igneous mineralogy. The Pd/Pt ratios of 9 suggest a process of hydrothermal concentration for the Pd and it is proposed that the Pd has been remobilized and reconcentrated by hydrothermal solutions derived from the granitic magma which reacted with the Pd concentrated in the primary magmatic sulphides. Mercury may have been leached from surrounding sediments by the hydrothermal solutions. It is possible that potarite and the other PGM formed at temperatures of up to 650°C and are likely to be found in other thermally metamorphosed ultramafic rocks showing a depleted character (spinel Cr/[Cr+A1]>0.7), common in orogenic belts.