<p>Electrocatalytic co-reduction of CO₂ and nitrate offers an attractive and sustainable pathway for urea synthesis, as it enables the simultaneous valorization of nitrogenous waste and CO₂ into value-added chemicals. However, achieving ambient and high-performance urea electrosynthesis remains a persistent challenge, as it requires the simultaneous activation of CO₂ and efficient H₂O dissociation to supply active *H for *NO_<i>x</i> hydrogenation—ultimately forming key C-and N-containing intermediates necessary for effective C–N coupling. The stringent, sequential nature of the reaction requirements continues to present substantial challenges for the rational design of advanced multifunctional catalysts. Herein, we report a creative two-in-one catalyst, bifunctional Pd-single-atom-modified Cu (Pd₁Cu) nanorods, to synergistically promote the adsorption and stepwise activation of dual species, that is, CO₂ and H₂O, thereby effectively steering the reaction pathway toward the highly selective synthesis of urea. By integrating experimental evidence, <i>in situ</i> spectroscopy, and computational analyses, we clearly disclose that the atomically dispersed Pd sites kinetically favor the co-generation of *CO and *NH₂ (via H₂O dissociation-driven proton transfer), thereby forming an optimal intermediate balance that facilitates urea synthesis. More importantly, the rationally designed Pd₁Cu leverages dual metal active sites to enhance C–N coupling via combined electronic and geometric effects, substantially lowering the reaction energy barrier and improving selectivity toward urea.</p>