Strain has been shown to modulate adsorption and reactions on metal surfaces. While its effect on surface-adsorbate interactions has been rationalized, an understanding of the electronic factors that drive these interactions and their consequences on catalytic activity is lacking. In this work, we used an ab initio density functional theory (DFT) to develop descriptors to describe the effect of biaxial strain in modulating interactions of adsorbates and transition states (TS) with the Pd (111) surface and its effect on the catalytic activity for ammonia (NH3) synthesis. We established the p-band center (p(center)) of the NHX (x = 0,1,2,3) and N-2 adsorbates and hydrogenation TSs, and the hybridized d-band center (d(center)) of the surface metal as key electronic descriptors for adsorbate and TS energy variations with strain. The p(center) of the adsorbates was lowest for the sites with the strongest adsorption, and the upshift of the d(center) of the surface metal atoms was greatest for the adsorption site with the highest strain susceptibility (i.e., the change in adsorption energy per unit applied strain). We first showed that tensile strain plays a dual role in enhancing N-2 dissociation, the rate-determining step in NH3 synthesis on the Pd (111) surface, strengthening the adsorption of atomic N and weakening the N-N bond in the TS. Using a DFT-activity model, we report that over a net 4% tensile strain (+/- 2%), N-2 dissociation was enhanced by similar to 5x , and the turnover frequency (TOF) of the overall reaction was enhanced by similar to 10x. We then evaluated N-2 dissociation at 3/4 ML H-coverage under industrially relevant conditions (150 atm H-2, 50 atm N-2, and 723 K), revealing the effect of tensile strain on the DFT-activity to be 2 orders of magnitude greater (similar to 948x vs similar to 5x) at high surface coverages. Overall, this study develops physical insights into how strain influences adsorption and TS (and, therefore, the reactivity) and broadly highlights strain as a useful design tool to improve catalytic activity.