Manchester City striker Erling Haaland won August's Player of the Month award after he scored seven goals in the opening three Premier League matches.
However, the Norwegian failed to make the cut for September, ensuring that there will be a different winner for the month of September.
In fact, the Premier League champions are not represented by any of the eight nominees, but one of the former players is among the favourites to clinch the top prize.
Palmer, Diaz lead Player of the Month nominees
Palmer, who graduated from the Man City academy, has been shortlisted after he scored five goals in his three Premier League appearances last month.
Impressively, four of those goals arrived in a blistering 20-minute period in Saturday's 4-2 victory over Brighton & Hove Albion at Stamford Bridge.
Liverpool's Diaz will be challenging Palmer for the award after scoring four goals in as many appearances in September.
The Colombia international scored twice in a 3-0 win over Manchester United, before he netted another brace in a 3-0 victory against Bournemouth.
Who else has been nominated?
Diaz's teammate Ryan Gravenberch has also made the shortlist after showcasing his quality in the number six role of Arne Slot's side.
The Dutchman played every minute of Liverpool's four September matches, completing the most passes in the top flight (231) and winning possession more than any other Premier League player (29).
Elsewhere, Arsenal's Gabriel Magalhaes is the only defender on the shortlist after he contributed at both ends of the pitch for Mikel Arteta's side.
Gabriel made five blocks and won 12 duels as well as scoring two crucial goals - a winner in the North London derby against Tottenham Hotspur and Arsenal's second in a 2-2 draw with Manchester City.
Aston Villa's Ollie Watkins scored four goals and provided one assist to seal his spot on the list of nominees, while Everton's Dwight McNeil registered four goal contributions to make the cut.
Fulham striker Raul Jimenez and Newcastle United attacker Harvey Barnes complete the list of names that are hoping to win September's top prize.
The winner will be decided by a combination of fan votes and a panel of football experts.
September's Player of the Month nominees in full
Harvey Barnes (Newcastle United)
Luis Diaz (Liverpool)
Gabriel Magalhaes (Arsenal)
Ryan Gravenberch (Liverpool)
Raul Jimenez (Fulham)
Dwight McNeil (Everton)
Cole Palmer (Chelsea)
Ollie Watkins (Aston Villa)