Paloncha, also spelled as Palwancha, is a small town and a municipality in Khammam district of Andhra Pradesh. Paloncha has a small town charm with a population of about 70, 000 denizens (as per 2001 census) with a blend of cosmopolitan. It developed into an industrial town being home to many prominent industries of Andhra Pradesh - Nava Bharat Ferro Alloys (NBFA), Sponge Iron India Limited (SIIL), etc. The Kothagudem Thermal Power station (KTPS), is also based in Paloncha.
Paloncha was basically a Gram Panchayat and was awarded the status of Municipality during 1987 by merging the 33 tribal villages that were in close vicinity. This was probably the result of the establishment of the above industries. Paloncha is close to famous temple town of Lord Rama- Bhadrachalam. Other famous tourist destinations nearby include Kinnerasani Wildlife Sanctuary and Papi Hills or Papikondalu.
The town now developed into a well-known education centre with home to Engineering colleges and University.