About 7,000 people streamed into tiny Searchlight, a former mining town 60 miles south of Las Vegas, Nevada, to vent their fury at President Barack Obama and the health care overhaul.
Mrs Palin told them the big-government, big-debt spending spree of the Democrats was over.
"You're fired!" Mrs Palin said.
A string of polls has shown Senate Majority Leader Harry Reid is vulnerable in politically moderate Nevada after pushing Mr Obama's agenda in Congress. His standing has also been hurt by Nevada's double-digit unemployment and record foreclosure and bankruptcy rates.
However, Mr Reid, a native of Searchlight, said: "I'm happy so many people came to see my hometown of Searchlight and spend their out-of-state money, especially in these tough economic times. This election will be decided by Nevadans, not people from other states who parachuted in for one day to have a tea party."
The rally kicked off a 42-city bus tour that ends in Washington on April 15. The movement is a coalition of deeply conservative groups angered by Obama's push for what they see as "socialist" public health care.