In the early '80s, Palmer worked as an assistant engineer at Utopia Studios in London, England, helping musicians like Mark Knopfler and Dead Or Alive.
In the latter half of the '80s, Palmer became a producer, and his keen ears and technical knowledge contributed to edgy post-punk group such as The Mighty Lemon Drops, The Mission, Gene Loves Jezebel, and House Of Love acquiring airplay on U.S. modern rock stations; Palmer gaves the band a radio-friendly sheen that didn't mollify their sound.
In 1989, Palmer produced David Bowie's debut LP with Tin Machine.
Much of Bowie's output in the '80s was chastised for its slick pop, but Palmer emphasized Tin Machine's scrappy guitars and thunderous drums, laying the foundation for Bowie's artistic comeback in the '90s.
Palmer started to focus more on mixing and remixing in the '90s, offering his skills to diverse alternative groups like Mother Love Bone, Pearl Jam, James, Catherine Wheel, Ned's Atomic Dustbin, Cure, and Concrete Blonde.
In 2000, Palmer mixed several tracks on U2's All That You Can't Leave Behind album. He has also produced Ozzy Osbourne, mixed Robert Plant, the Goo Goo Dolls, Tarja Turunen, and even mixed a track for Faith Hill.