McCarthy, 28, leaves the Blues after making 133 appearances for the club since joining from Wigan Athletic for £13 million in September 2013, scoring six goals.
He followed manager Roberto Martínez from the DW Stadium to Goodison Park, and was a regular in the Spaniard’s team during his three-year tenure.
But since Martínez’s sacking in May 2016, McCarthy has registered just 20 Everton appearances, as his Toffees career became beset by injury.
After suffering a double leg break in January 2018, the Irishman’s only first team football since then came as a late substitute in Everton’s 4-0 win over Manchester United in April.
↩️ | Thank you for giving everything over the past six years - and good luck* with your new adventure at @CPFC, Jamesy!— Everton (@Everton) August 7, 2019
*Just not on Saturday!
Following the permanent signing of loanee André Gomes from Barcelona, and the additions of fellow midfielders Fabian Delph from Manchester City and Jean-Philippe Gbamin from Mainz 05, McCarthy’s opportunities were likely to remain limited at Goodison this term.
He is now hoping to reignite his career with Palace, telling the club’s official website:
“I can’t wait to get started. It feels like a very nice club, nice family club. The fans obviously come out in their numbers and I spoke to James [McArthur], he couldn’t speak any more highly of it.
“I’m delighted to be here; it’s a fresh start that I thought I needed.”
Ironically, McCarthy may make his Eagles debut against Everton, when the Toffees travel to Selhurst Park for the first game of the 2019-20 season on Saturday.