Bimetallic nanoparticles (BMNPs) exhibit composition, dimension and configuration dependent optical, catalytic and magnetic properties, which can make them promising candidates for various applications. In this paper, the Ag_xPd_1−x bilayer composition effect, i.e. Ag_0.75Pd_0.25, Ag_0.50Pd_0.50 and Ag_0.25Pd_0.75, on the evolution of Ag_xPd_1−x BMNPs is thoroughly investigated on c-plane sapphire by the control of annealing temperature, duration and deposition thickness. Bimetallic nanoparticles of various dimensions and configurations are fabricated at different dewetting stages by the thermal activation, diffusion and inter-mixing of Ag–Pd adatoms with respect to the growth conditions. With elevated annealing temperature, the gradual transition from voids to nanoclusters and individual BMNPs is demonstrated based on the surface and interface energy minimization and Volmer–Weber growth model. Owing to the high diffusivity of Ag atoms, the bilayers with the higher Ag component show improved dewetting at relatively low temperature whereas the high Pd composition set shows an increased stability against dewetting. Meanwhile, the transition of BMNPs from connected to individual and compact spherical configuration is witnessed along with extended annealing duration. At the same time, a significant dimensional expansion of NPs is achieved with increased deposition thickness. On the other hand, the Ag concentration from BMNPs is reduced due to sublimation at high temperature, which causes overall size attenuation. Moreover, the fabricated Ag_xPd_1−x BMNPs are characterized based on their reflectance spectra and the evolution of their absorption band, peak formation and their shifts are correlated with the dynamic surface plasmon resonance of Ag_xPd_1−x BMNPs based on the surface morphology.