Mr Trump has promised a "major announcement" at an event in Iowa today
His Iowa campaign chairwoman said there would be a mystery "special guest" at the event.
There were several possibilities for who the "special guest" could be, including religious leader Jerry Fallwell Jr, and John Wayne's daughter who has previously expressed support for Mr Trump.
However, many Trump supporters believed it could be Mrs Palin, the Republican candidate for Vice President in 2008 and former governor of Alaska. The anticipation grew after a private jet was tracked flying from Anchorage, Alaska to Ames, Iowa, the site of Mr Trump's rally.
The former Alaska governor has so far expressed admiration for Mr Trump and his rival Ted Cruz but refused to choose between them.
Big announcement in Ames, Iowa on Tuesday! You will not want to miss this rally! #Trump2016 https://t.co/J2wyAfXdlz pic.twitter.com/lErVfowpMX
— Donald J. Trump (@realDonaldTrump) January 17, 2016
Mrs Palin remains popular with members of the Tea Party movement, evangelical Christians, and a large section of the party's conservative base, some of whom have been suspicious of Mr Trump.
Some of Mr Trump's supporters have feverishly speculated abour the possibility of a Trump/Palin ticket, and Mrs Palin has already said she would be willing serve in a Trump Administration.
Mr Cruz's campaign said they did not know whether Mrs Palln was going to endorse his rival.
Rick Tyler, a spokesman for Mr Cruz, said such an endorsement would reflect badly on Mrs Palin.
He said: "I think it would be a blow to Sarah Palin because Sarah Palin has been a champion for the conservative cause, and if she was going to endorse Donald Trump, sadly, she would be endorsing someone who's held progressive views all their life on the sanctity of life, on marriage, on partial-birth abortion.
"Donald Trump claims he's changed all those views but, if it was Sarah Palin, let me just say I'd be deeply disappointed."
Mrs Palin has previously defended Mr Trump against suggestions that he does not know enough about foreign policy.
In September she told CNN: "I think I'd rather have a president who is tough and puts America first than can win a game of Trivial Pursuit.
"I don't think the public gives a flying flip if somebody knows who, today, is a specific leader of a specific region or a religion or anything."
Proudly Clinging To God, Guns, and Constitutional Rights to Keep 'Em What a great gift! What a great way to... https://t.co/DAFOD3U4CW
— Sarah Palin (@SarahPalinUSA) January 5, 2016
She has also previously suggested she would like to be Energy Secretary in a Trump administration - so that she could abolish the department.
She said: "I think a lot about the Department of Energy because energy is my baby - oil and gas and minerals, those things that God has dumped on this part of the Earth for mankind's use instead of us relying on unfriendly foreign nations.
"I'd get rid of it (the department) and I'd let the states start having more control over the lands that are within their boundaries.
"If I were in charge of that it would be a short term job but it would be really great to have someone who knows energy and is pro-responsible development to be in charge."
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