This work describes the design and fabrication of free-standing carbon nanotube-palladium (CNT-Pd) composite sheets for hydrogen gas sensing. The CNT-Pd composites were made by electroplating palladium onto a solvent-densified and oxygen plasma-treated CNT sheet. The latter was prepared using high purity CNTs drawn from a dense, vertically aligned array grown by chemical vapor deposition on silicon substrates. The CNT-Pd sheets were characterized by energy-dispersive spectroscopy, scanning electron microscopy, and X-ray diffraction. The amount of palladium in the composite was 16.5 wt % as measured via thermogravimetric analysis. Thin strips of the CNT-Pd sheets were assembled as chemiresistor sensors and tested for hydrogen gas detection. The sensors demonstrated a limit of detection of 0.1 mol % and displayed signal reversibility without the need for oxygen removal or heat treatment. A decrease in signal reversibility was observed after multiple exposure cycles; however, redensification with ethanol significantly restored the original reversibility. The sensor showed the Freundlich adsorption isotherm behavior when exposed to hydrogen. The material's potential application toward a wearable, flexible sensor was demonstrated by integrating the chemiresistor onto a fabric material using hot-press processing and testing the composite for hydrogen sensitivity.