Palau is one of the world's truly spectacular scuba diving locales, with coral reefs, blue holes, WWII wrecks, hidden caves and tunnels and over 60 vertical drop-offs. It's the meeting place of three major ocean currents, which bring abundant food supplies and an enormous variety of marine life to the area. Thanks to that, the waters surrounding the Rock Islands literally teem with over 1500 varieties of reef and pelagic fish and more than four times the number of coral species than is found in the Caribbean. If you're a diver, you probably already know this, and if you've ever thought about learning, Palau is the place. Need further testimony? Palau was named the number one Underwater Wonder of the World by CEDAM International, an organisation of divers, marine scientists and conservationists. The southern end of the archipelago is particularly worthwhile.
If you're sticking close to the main tourist area, the beach fronting the Palau Pacific Resort has some of Koror's best snorkeling, with rainbows of tropical fish, platter and mushroom coral and giant tridacna clams in full view. That said, no one really comes to Palau to snorkel in Koror. The real action is in and around the Rock Islands, and it's worth whatever it takes to get yourself out there. Probably the most surreal snorkeling experience you'll ever have is waiting for you at Jellyfish Lake, a saltwater lake made famous by the National Geographic TV special Medusa. A ten-minute jungle trek inland, it pulsates with millions of harmless, transparent jellyfish, swimming en masse and following the sun.
For sun seekers, Palau's best beaches are found on the Rock Islands, Babeldaob and Peleliu, but most islands have a few lovely spots to toss down your towel. Local sportfishing catches include marlin, sailfish, tuna, mahi-mahi and wahoo. There are also tennis, running and - increasingly - kayaking possibilities on Koror, if underwater watersports aren't your bag.