The state's highest court denied a request by the Iowa Board of Regents for an immediate stay of a judge's ruling last week that allowed Palo to return to the team.
Palo was suspended in 2012 after being charged with second-degree sexual assault. The charge was dropped a year ago, and the university's Office of Judicial Affairs cleared Palo to return to the team.
But Palo was found to have violated Iowa State's student code of conduct by president Steven Leath and kicked off the team on Aug. 30.
Palo is listed on the roster for Saturday's home game against Kansas State.