On 5 July 2007, Palermo announced on their official website to have signed Miccoli with a three-year agreement, costing Palermo €4.3 million. He completed a four-way swap: Miccoli replaced the left of Andrea Caracciolo, Caracciolo for Fabio Quagliarella and Vincenzo Iaquinta was replaced by Quagliarella. Miccoli returned to Italian football in the 2007–08 season and took part in the "Rosanero"'s third UEFA Cup campaign. He scored a total eight goals in his first season with the Sicilian club, including the winning goal in the Sicilian derby against Catania, despite a number of injuries which prevented him from playing continuously in the season.