Abstract The electro‐hydrogenation of benzofuran (BF) has been considered as a promising route for the selective synthesis of 2,3‐dihydrobenzofuran (DHBF), a valuable motif prevalent in agrochemicals and pharmaceuticals. However, the aqueous hydrogenation of hydrophobic BF has rarely been investigated, probably due to intense competition from hydrogen evolution reaction (HER). Herein, taking Pd nanoparticles anchored on carboxylated carbon nanotube (Pd@ c ‐CNT) as a model catalyst, we demonstrate a highly selective BF hydrogenation to DHBF under aqueous acidic conditions, yielding DHBF Faradaic efficiency (FE DHBF ) of approximately 50%. It is found that incorporating tetrabutylammonium hexafluorophosphate (TBAPF 6 ) as an auxiliary electrolyte (AE) can further enhance the FE DHBF up to 83.7%. In situ attenuated total reflection surface‐enhanced infrared spectroscopy (ATR‐SEIRAS) combined with theoretical calculations reveals that the hydrated TBA + cation promotes the formation of interfacial water on the hydrophobic cathode surface, thereby lowering the reaction barrier and facilitating BF hydrogenation. A series of electrolyses using deuterated and/or non‐deuterated electrolytes verifies that the water dissociation at the counter electrode (anode) serves as the primary proton source for the BF hydrogenation.