Fruiting body sessile to substipitate, at first subglobose, to cushion-shaped, soon deeply wrinkled to cerebriform; substipitate forms initially short-cylindrical to turbinate, becoming lobed to deeply convoluted, sometimes laterally compressed from adjacent fruiting bodies and appearing fan-shaped; at maturity up to 5 cm broad, 2 cm tall, abruptly narrowed and pallid at the attachment point; surface viscid, glabrous, roughened with a hand-lens, yellow-orange, drying reddish-orange to reddish-brown, forming a tough, membranous film on the substrate; context gelatinous, colored like the cap, tending to liquify with age; odor and taste not distinctive.
Spores 18.0-23.0 x 6.5-8.0 µm, oblong to slightly curved, smooth, thin-walled, contents granular, up to seven septa at maturity; spores pale-yellow in deposit.
Scattered to clustered on decorticated conifer wood, or emerging from bark cracks; fruiting throughout the winter months after rainy periods; common.
Dacrymyces palmatus is a yellow-orange jelly fungus which closely mimics Tremella aurantia, the common witch's butter. The two taxa are best told apart in the field by differences in habit and substrate. Tremella aurantia is a parasite of Stereum species and typically fruits with its host on hardwoods usually with intact bark. In contrast, Dacrymyces palmatus occurs on decorticated conifer wood and is not associated with Stereum species. Despite their similar appearance, the two taxa are actually distantly related as evidenced by their very different microscopic characters. Tremella aurantia has basidia which are longitudinally septate and ovate spores, while Dacrymyces palmatus has tuning-fork shaped basidia and multi-septate, curved-oblong spores.