Palmer, who was at No. 143 on the money list with two tournaments remaining, had to call a penalty on himself and made bogey on the 10th hole, then took double bogey on the next hole with a tee shot into the water.
But he rebounded with a birdie he desperately needed on the final hole at Ginn Ocean Hammock Resort for his second career victory.
Also tying for second were George McNeill, Nicholas Thompson, Ken Duke and Vaughn Taylor, who was at No. 129 on the money list and earned enough to secure his card for next year.
The final tournament next week is at Disney, and the top 125 keep full privileges for 2009.
The fourth round twice was suspended because of bad weather, which didnt help anyone break out of the pack. Seven players had at least a share of the lead at one point, and there was a six-way tie during the first stoppage in play.
Palmer appeared to have control with a two-shot lead until he reached the 10th green. He noticed his ball move slightly after he addressed his 30-foot birdie attempt, and after calling a rules official, assessed himself a one-shot penalty and made bogey.
He pulled his next tee shot into the water for double bogey to fall out of the lead, but rejoined the back with an up-and-down from the bunker on the par-5 13th. Palmer made pars the rest of the way, including a nervy two-putt from 40 feet on the 17th, then laid up on the closing hole and stuffed his wedge into 10 feet for the winning putt.
Palmer finished at 7-under 281 and earned $828,000. It was the fifth time in six events during the Fall Series that a player outside the top 125 on the money list won a tournament. The exception was Zach Johnson, who was at No. 125 when he won in Texas.
As crowded as it was at the top, it could have been worse.
John Huston, at No. 168 on the money list, hit his tee shot into the water on the 16th and made bogey. Mark Wilson took two shots to get out of a greenside bunker on the 16th and made double bogey.
Robert Allenby, the runner-up at Turning Stone by one shot, had a chance to take the lead on the par-5 18th until he hit his wedge long and into a back bunker. He blasted out 40 feet long and wound up with a bogey.
Allenby and Huston were in the group at 5-under 283. That group included Brian Gay, who was at No. 33 on the money list and earned enough to move into the top 30, giving him a chance to earn his first trip to the Masters if he stays there after Disney.