When the Society for the Promotion of Theological Education, which controlled Harvard Divinity School at the time, appealed to alumni for funds to build Divinity Hall, Palfrey preached two sermons to raise $2,000. He became the society's secretary in 1827 and a Harvard Overseer in 1828, when he also began teaching part-time. In 1831, after Andrews Norton retired in 1830, he became a Professor of Biblical Literature and Dean of Faculty at the Divinity School and removed to Cambridge. In this position, in addition to teaching the Bible, Hebrew, and other semitic languages, he was in charge of the building, organized faculty meetings, and was the chief disciplinarian. He made changes, including instituting a new set of rules for the school, reorganizing the curriculum, and dealing with complaints from faculty members about their salaries.