Prepare a planting site before digging up dwarf palmettos for transplant. Select a partially-shaded spot with moist soil. Using a trenching shovel, dig a planting hole measuring 20 inches wide and 12-to-16 inches deep.
Dig up the dwarf palmetto offshoot from the base of its parent shrub. Insert the blade of the trenching shovel into the soil between the parent shrub and offshoot. Press the shovel into the soil to its full length.
Work the trenching shovel around the base of the offshoot. Mark out a 12-inch radius around the offshoot so the shovel will not disturb or damage the roots.
Grasp the base of the dwarf palmetto trunk in both hands. Lift the shrub from the ground. Crumble off half the soil from around the roots. Fill in the resulting hole.
Hold the dwarf palmetto palm in the planting hole so the base of the trunk is on the same level as the surrounding soil. Fill in around the roots with soil. Do not firm the soil, since it might damage the roots.
Water the dwarf palmetto to a depth of 5 inches once a week for the first month. Do not let the soil dry out completely for the first month after transplant, since the root growth might be negatively impacted.