Yes, Laura Palmer is dead. Yes, her cousin Maddie (who was also played by Sheryl Lee) is dead as well, but it was the murder of Laura that sparked the story of Twin Peaks. The mystery of who killed her is what captured the interest of the television world, and helped make the show such a cultural phenomenon. "Who killed Laura Palmer?" brought in millions of obsessive fans in the early '90s. Unfortunately, the show took a dip in quality when Lynch and Mark Frost were forced to give a resolution years before they should have. Still, it's her tragic story that connects the residents of the town, and our interest to the show. Some form of Laura Palmer is still in the Black Lodge. She encountered Dale Cooper there in her dreams, and then face-to-face in the finale. While she's dead, perhaps she can now help Cooper. Actress Sheryl Lee has already indicated that she'll be back. And it's hard to imagine not seeing her returning to her most important role in some way. Just hope she doesn't scream right into the camera again. That still gives everyone nightmares.