Methane is an important explosive gas, used extensively at the domestic and industrial sites. It is the main constituent of natural gas, which is the main fuel supplied to homes and industries including automobiles. Detection of trace level of methane gas is very important to avoid any accidental explosion due to its leakage and may cause loss of valuable human life and property. The present paper is focused on the development of new sensing material in the form of composites to improve sensitivity, selectivity and stability. Present work shows the enhanced response of SnO2-ZnO composite structures for methane sensing and further increases its sensing response by loading appropriate catalyst on the sensor surface keeping in view of Fermi energy control mechanism and spillover mechanism. A stable sensor response of 77-85 % was obtained for SnO2-ZnO-Pd sensor structure over a wider range of temperature (160-260oC).