We present spectral and energy-dependent timing characteristics of the hard X-ray transient IGR J17497-2821 based on XMM-Newton observations performed five and nine days after its outburst on 2006 September 17. We find that the source spectra can be well described by a hard (Gamma similar to 1.50) power law and a weak multicolour disc blackbody with inner disc temperature kT(in) similar to 0.2 keV. A broad iron K alpha line with FWHM similar to 27 000 km s(-1), consistent with that arising from an accretion disc truncated at large radius, was also detected. The power density spectra of IGR J17497-2821, derived from the high-resolution (30 mu s) timing-mode XMM-Newton observations, are characterized by broad-band noise components that are well modelled by three Lorentzians. The shallow power-law slope, low disc luminosity and the shape of the broad-band power density spectrum indicate that the source was in the hard state. The rms variability in the softer energy bands (0.3-2 keV) found to be similar to 1.3 times that in 2-5 and 5-10 keV energy bands. We also present the energy-dependent timing analysis of the RXTE/PCA data, where we find that at higher energies, the rms variability increases with energy.