The actin scaffold protein palladin regulates both normal cell migration and invasive cell motility, processes that require the co-ordinated regulation of actin dynamics. However, the potential effect of palladin on actin dynamics has remained elusive. In the present study, we show that the actin-binding immunoglobulin-like domain of palladin, which is directly responsible for both actin binding and bundling, also stimulates actin polymerization in vitro. Palladin eliminated the lag phase that is characteristic of the slow nucleation step of actin polymerization. Furthermore, palladin dramatically reduced depolymerization, slightly enhanced the elongation rate, and did not alter the critical concentration. Microscopy and in vitro cross-linking assays reveal differences in actin bundle architecture when palladin is incubated with actin before or after polymerization. These results suggest a model whereby palladin stimulates a polymerization-competent form of globular or monomeric actin (G-actin), akin to metal ions, either through charge neutralization or through conformational changes.