Palau says it has agreed to accept 17 Chinese detainees for temporary resettlement to end their eight-year jail time at the US-run prison camp in Guantanamo Bay in Cuba.
The Marianas Variety reports that Palau's President Johnson Toribiong is in favour of accepting them, but he says it is still not known whether the detainees will be brought to Palau.
Mr Toribiong says Palau's decision is a humanitarian gesture intended to help them be freed from any further unnecessary incarceration.
He says this will enable the Chinese detainees to restart their lives in a normal fashion.
The president says the decision has nothing to do with the upcoming review of the Compact of Free Association under which the US gives large sums to Palau.
The detainees are ethnic Uighurs from the mostly Muslim autonomous region in western China.