Most of the songs on the album were derived from the half-dozen albums Nesmith recorded for RCA Records in the early 1970s.

The album reunited Nesmith with drummer John Ware, whom he had worked with on his first three albums Magnetic South, Loose Salute, and Nevada Fighter, and also marked one of his first collaborations with guitarist John Jorgenson and keyboardist John Hobbs; both would play in the group the Hellecasters with help from Nesmith.

Nesmith lampoons the album on his Grammy Award winning 1981 music/comedy video, Elephant Parts.

In the 1990s, when his Pacific Arts back catalog was being reissued on CD, Nesmith withheld Live at the Palais from re-release citing dissatisfaction with his performance.

However, due to demand from his fans worldwide, Nesmith reissued the album in 2001 and included nearly a half-hour of bonus material drawn from other live performances.