In this paper, the effect of SO2 adsorption on graphene (intrinsic, vacancy, and doped) is investigated for structural and electronic properties to exploit their potential applications as a gas sensor. The adsorption energy, charge transfer, magnetic moment, density of states, as well as band structure of the SO2 molecule on the vacancy and doped graphene systems are thoroughly discussed. The most stable adsorption site for SO2 on various graphene sheets is also identified and reported. It is found that SO2 molecule is weakly adsorbed on intrinsic graphene (IG) with low adsorption energy. In contrast, vacancy defect and Pd doping significantly enhance the strength of interaction between SO2 molecule and the modified substrates. The dramatic increase in adsorption energy and charge transfer of these systems are expected to induce significant changes in the electrical conductivity of the vacancy graphene (VG) and Pd-doped graphene (PdG) sheets. Furthermore, the results present the potential of Pd-doped vacancy graphene (Pd-VG) for molecular sensor application.