In the semiconducting metal oxide field for sensor application tin dioxide material is the most studied one. Besides SnO2, tin monoxide (SnO) is attracting attention of researchers due to its outstanding sensor response to NO2, which is a dangerous gas and its concentration is becoming critical in many cities around the world. In this work we present a detailed sensing mechanism of pristine and Pd decorated SnO micro-disks. For pure SnO micro-disks the ionosorption model takes place, where electrons are trapped at oxidizing atmospheres, such as NO2, depleating the material and increasing its electrical resistance. We observed that this effect is enhanced by the electric lone pairs present at the (001) largest surface of SnO disks, promoting the highest sensor response. On the other hand, in reducing atmospheres, the density of charge carriers if slightly increased due to analyte adsorption, resulting in a low sensor response. When decorating the material surface with Pd nanoparticles (NPs), it may occur electronic sensitizatioin (ES) or chemical sensitizatioin (CS) at material surface, depending on the Fermi level difference between the SnO and the Pd-NPs. ES occurs when the difference between Fermi levels is high and produces a Schottly barrier between the metal and the semiconductor, while CS is related to the catalytic effect that NPs have with analytes. We observed that Pd decorated disks present lower response to NO2 due to the smaller available sites to interact on SnO surface. On the other hand, due to the catalyst effect between Pd and hydrogen molecules (Split-over and spillover), this system presented high sensitivity to H2. Looking at the Fermi levels of SnO and Pd it is possible to observe that its difference is only about 0.1 eV, so CS is the main responsible for the highest sensor response of this system to hydrogen. Activation energy calculation provided values of barriers for the pristine and Pd decorated disks.