Palmer was born in Adelaide, South Australia. She studied at KDS school of Journalism in Adelaide. Palmer made her film debut as Melody in 2:37, before appearing in the The Grudge 2 as an American schoolgirl named Vanessa. She was originally cast as the female lead in Jumper, but was later replaced by Rachel Bilson. She will next appear in the films December Boys, alongside Daniel Radcliffe and Kids in America, playing Topher Grace's love interest. She also appeared in the music video for Breaking Up by Eskimo Joe which was released as the fourth single from their third album Black Fingernails Red Wine.

Palmer remains based in her home city of Adelaide. She is dating her Kids In America co-star, Topher Grace.