It is an elongated 50–70 km (31–43 mi) long complex of volcanoes north of the Aeolian Islands with multiple potential calderas.

The shallowest point lies at 80–70 m (260–230 ft) depth and formed an island during past episodes of low sea level.

[25] The southern Tyrrhenian Sea is a back-arc basin[10] which began to form 11 million years ago through crustal extension[24] behind the eastward-shifting Ionian subduction,[25] and is a complex geodynamic system.

[10] A 2017 proposal relates the volcanism of Palinuro and neighbouring seamounts except Marsili to the upwelling of asthenospheric mantle below the northern margin of the Calabrian subduction zone, and from underneath the descending Ionian slab.

[34] Dense and large stands of deep water corals[35] and coralline algae grow on Palinuro, the latter particularly around the summit.

Holothurians, melon sea urchins,[36] nematodes,[37] sabellids, serpulid worms, spiny lobsters, sponges, tube-dwelling anemones, tunicates and yellow gorgonians live there as well.

Lower on the slopes algae become rarer and sponges more frequent, and black corals dominate at maximum depths.

[36] Fossil algae, bivalves, bryozoans, corals, echinoids, gastropods, mussels and calcareous worm tubes have been dredged from Palinuro.

[57] Diffuse hydrothermal emissions have been found at Palinuro,[58] which form small chimneys,[42] stained rocks,[23] spires reaching 30 cm (12 in) height[59] and warm (>60 °C (140 °F)) muds with sulfide-sulfate deposits.

[63] The active hydrothermal vents are accompanied by chemical anomalies in the water column,[64] and ships have reported a smell of hydrogen sulfide above the eastern part of Palinuro.

[66] Additional minerals reported are bravoite, chalcopyrite, covellite, enargite, marcasite, luzonite, melnikovite, tennanite, wurtzite and lead and silver containing sulfosalts.

The sulfide deposits typically have a gel-like appearance[43][67] and contain bacterial fossils,[68] implying that microbial activity played a major role in their development.

[42] Such seafloor massive sulfide deposits are potential sources for metals, both base and precious, and have thus drawn scientific attention.

[70] Other reported minerals at Palinuro are bismuthinite, bismuth tellurides, stibnite and traces of gold, indium, silver[71][72][73] and sulfur.