The increasing use of hydrogen (H-2) as a clean energy carrier utilized in the next-generation fuels demand parallel development of low power hydrogen sensors (operated at room temperature) for safety purposes. In this work, we report a controlled single-step, large-area growth of vertically aligned edge-oriented MoS2 hybrid nanostructured thin film decorated with Pd nanoparticles (Pd/MoS2) on quartz and Si substrates using DC magnetron sputtering technique. The structural, morphological, and chemical characterizations were performed using XRD, Raman, FESEM, TEM, EDX, and XPS techniques, which confirms the formation of Pd/MoS2 hybrid thin film. Hydrogen gas sensing characteristics of Pd/MoS2 hybrid thin film sensor under low detection range (10-500 ppm) and proposed sensing mechanism are discussed in detail. To gain further insights into the gas sensing mechanism, we have studied the junction band alignment at the Pd/MoS2 interface using ultraviolet photoelectron spectroscopy and ellipsometry. The results demonstrate that the fabricated Pd/MoS2 hybrid thin film sensor exhibits highly enhanced H-2 sensing properties (decent response similar to 33.7 %, fast response/recovery time similar to 16 s/38 s, and higher selectivity) compared to pristine MoS2 thin film sensor (poor response similar to 1.2 % and slow response/recovery time similar to 29 s/158 s, and poor selectivity) towards 500 ppm H-2 at room temperature (30 degrees C). Thus, this study offers the development of low power H-2 sensors with enhanced sensor characteristics, which could be utilized in IoT (Internet of Things) network, with an advantage of facile and scalable fabrication techniques.