Upon his return to the states in the late 1870's, he and Church rented a studio in New York City. They kept it from 1878 until 1881. Palmer first received major attention for his winter scenes in 1887 when he received the Second Halgarten Prize of the National Academy for his painting "January". This award is for outstanding young (under 35) artists with potential. It wasn't his only award. He received the gold medal from the Philadelphia Art club in 1894 and another gold medal from the Boston Art Club in 1895. More awards came from more prestigious Art Associations and his reputation continued to grow.

In 1915, Palmer, now 61 years old, spent the summer in Gloucester, Mass.  A habit he would continue to do for many years thereafter.

Walter L. Palmer died in his hometown Albany NY on April 16, 1932 at the age of 78. After his death his work fell out of favor and many museums deaccessioned his paintings in the years following W.W.II. By the early 1960's, representational art was out and often the frames were worth more than the paintings. People liked clean walls with no paintings -- a sort of delayed reaction to the covered wall style of the Victorian period. In the last 20 years the trend has again reversed and his work and those of American Impressionist and realistic artists of the early 20th century have been rediscovered.