The 25-year-old’s brother, Edwin, was murdered by kidnappers back in Honduras in May.
Edwin was taken hostake in October 2007, just 16-years-old.
Palacios told The Mirror: “I was thinking of giving up football altogether, I really was.
“The decision was really tough. The family comes first. He was a footballer as well, but he would have wanted me to keep on playing, as did the family in general. They helped me make the decision.
“My brother is always in my thoughts when I go out on the pitch, in training, when I do anything.
“He is an inspiration for me to carry on, he drives me forward.”
Palacios also revealed his delight at Honduras qualifying for the World Cup next summer.
Palacios added: “I am so happy that we have qualified for the World Cup.
“The people of Honduras are still partying at home and everyone is so excited about next summer.
“It makes me very proud to be part of something which is bringing joy and happiness to my country.
“The last time we played at the World Cup was in 1982. I wasn’t even born! But my father told me we had a good team and they gave a good account of themselves.
“For my generation of players though, this is our time and I am very much looking forward to next summer and I hope I can play a big part in the tournament.”