Prepare aromatics: Bruise lemongrass stalks with the back of a knife. Slice galangal, tear lime leaves, and smash chilies.
Heat the broth: In a large pot, bring chicken broth to a boil. Add lemongrass, galangal, lime leaves, and chilies. Simmer for 5 minutes to infuse flavors.
Add chicken: Add sliced chicken to the pot and cook for 5-7 minutes until chicken is cooked through.
Add coconut milk: Pour in coconut milk and bring to a gentle simmer. Do not boil vigorously as coconut milk may curdle.
Add mushrooms: Add sliced mushrooms and cook for 3-4 minutes until tender.
Season: Stir in fish sauce, lime juice, and palm sugar. Taste and adjust seasoning - it should be salty, sour, and slightly sweet.
Finish and serve: Remove from heat. Remove large pieces of lemongrass, galangal, and lime leaves if desired. Garnish with chopped green onions and cilantro.
Serve immediately: Ladle into bowls and serve hot with jasmine rice if desired.
Chef's Note: For a milder version, reduce the number of chilies or remove seeds. Fresh herbs are essential for authentic flavor - dried substitutes won't provide the same aromatic quality.