Heterogeneous catalyst surfaces are dynamic entities that respond rapidly to changes in their local gas environment, and the dynamics of the response is a decisive factor for the catalysts' action and activity. Few probes are able to map catalyst structure and local gas environment simultaneously under reaction conditions at the timescales of the dynamic changes. Here we use the CO oxidation reaction and a Pd(100) model catalyst to demonstrate how such studies can be performed by time-resolved ambient pressure photoelectron spectroscopy. Central elements of the method are cyclic gas pulsing and software-based event-averaging by image recognition of spectral features. A key finding is that at 3.2 mbar total pressure a metallic, predominantly CO-covered metallic surface turns highly active for a few seconds once the O-2:CO ratio becomes high enough to lift the CO poisoning effect before mass transport limitations triggers formation of a root 5 oxide. To follow in situ and in real time how catalyst surfaces respond to gas composition changes is a challenge. This study reports on an eventaveraging method, based on cyclic gas pulsing and software-based image recognition, that overcomes the challenge for large photoelectron spectroscopy datasets.