Pallets form the base of the unit load, which is the basis for global trade transportation. In order to achieve better performance, improve efficiency, and compete in much more versatile markets, industrial activities and pallet management service firms are becoming more automated than ever; they are adopting advanced manufacturing technologies and flexible manufacturing systems. This study focuses on the investigation of the most common compatibility issues between pallets and material handling systems in semi-automated and fully-automated warehouses. At the same time, it establishes an understanding of the downtime and frequency of problems caused by pallets in these types of facilities. This research was conducted in two phases. The primary phase was a mix mode questionnaire (phone interview and hard copy questionnaire) that was used to survey members of different industries, such as pallet manufacturers, equipment manufacturers, and pallet users. The secondary phase surveyed multiple general warehouses and storage facilities around the U.S., and surveyed warehouse professionals from manufacturing companies in the pharmaceutical, petroleum, dairy, beverage, chemical, and tobacco industries, to name a few. Results showed that 3% of the respondent warehouses are fully automated, and 20-30 % are semi-automated. Additionally, block class wooden pool pallets were identified as the most common pallet class used in semi/fully automated warehouses, followed closely by the use of stringer class recycled wooden pallets. Despite this, stringer class recycled wooden pallets were identified as the main pallet class involved in pallet related downtime in semi/ fully automated warehouses/ DC facilities. Further results present a guideline for improving automated warehouse performance, determine the pallet characteristics needed for this type of application, and expands the knowledge around downtime frequency cause by pallet related issues in these types of systems. / Master of Science / Pallets are the main tool used to transport unit loads throughout the different supply chains worldwide. Currently, industrial activities are becoming more automated than ever; in order to achieve better performance, improve efficiency, and compete in much more versatile markets. This study investigates the most common compatibility issues between pallets and material handling systems, used in semi-automatic and fully-automatic warehouses. Additionally, it presents the downtime and frequency of problems caused by pallets in these types of facilities. This research was conducted in two phases. The first phase identified the most common compatibility issues between pallets and these types of systems; this phase was achieved by surveying members of different industries such as pallet manufacturers, equipment manufacturers, and pallet users. The second phase targeted multiple general warehouses and storage facilities around the U.S.; during this phase, the frequency and downtime of the most common compatibility issues were determined. Results from this investigation present a guideline for improving automatic warehouse performance, determine the pallet characteristics needed for this type of application, and expands the knowledge around downtime frequency cause by pallet related issues in these types of systems.