Novel palladium nanoparticles/graphene-based composites were prepared by a method involving palladium nanoparticles in situ growth on chitosan-functionalized graphene. The resulted composites showed uniform palladium nanoparticles distribution, which were characterized by Fourier transform infrared spectrometry (FTIR), transmission electron microscopy (TEM), scanning electron microscopy (SEM), Raman spectroscopy, atomic force microscopy (AFM), X-ray diffraction spectroscopy (XRD) and electron diffraction pattern (ED), etc. Moreover, such graphene-based nanocomposites were successfully applied to catalyze the cyclotrimerization of acetylene with high regioselectivity (> or = 99.5%) and superior recycling performance without the assistance of any ligands.