Koror itself dosn't have much in the way of dive sites, but two are worthy of mention. Pincher's Reefis situated at the opening to Malakal Harbour. It's shallow with a sandy bottom and is a great location for photography that's best dived at night. Expect to come across plenty of crustaceans, feather stars, flatworms and nudibranches. Whilst there's no big fish life to talk about here, there's still plenty to keep you occupied.
Also situated in Malakal Harbour, Chandelier Cave is certainly worth a visit. As there is oxygen in the cave, it is suitable for those without a great deal of cave diving experience. It is made up of five seperate chambers that are all connected. The first four are under water - but with air pockets - whilst the fifth is above the water line. Over the years, fantastic stalactites and stalagmites have formed that now resemble chandeliers, hence the site's name. Fish life here includes cardinalfish, soldierfish and plenty of shrimp.
This is the largest island in Palau and also houses the capital of the same name which is now a bustling metropolis - certainly by the standards of the rest of the region. Most travellers and divers stay here and it's the "gateway" to exploring the wonderful dive sites that Palau has to offer.