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Palacios signed a one-year, $945,000 contract with the Rays on Thursday to avoid arbitration, Marc Topkin of the Tampa Bay Times reports.

Palacios appeared in just 17 games for the Rays in 2025 due to finger, knee and hamstring injuries, but he made the most of his limited opportunities, slashing .333/.396/.452 with three RBI, 10 runs scored and four stolen bases over 48 plate appearances. The 28-year-old utility man could begin to see regular time at second base in 2026 now that Brandon Lowe is in Pittsburgh, which would grant Palacios more opportunities to show off his baserunning skills.

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