Raised in northern New Jersey, Palwick attended Princeton University, where she studied fiction writing with novelist Stephen Koch, and she holds a doctoral degree from Yale. In the 1980s, she was an editor of The Little Magazine and then helped found The New York Review of Science Fiction, to which she contributed several reviews and essays. Although she is not a prolific author, Palwick's work has received multiple awards, including the Rhysling Award (in 1985) for her poem "The Neighbor's Wife." She won the Crawford Award for best first novel with Flying in Place in 1993, and The Alex Award in 2006 for her second novel, The Necessary Beggar. Her third novel, Shelter, was published by Tor in 2007. Another book, The Fate of Mice (a collection of short stories), has also been published by Tachyon Publications.