The 30-year-old only moved to Brighton in January but spent the last four months of the season on loan at Selhurst Park and has now made the switch after penning a two-year deal with the Barclays Premier League newcomers.
Dobbie has experience of playing in the Premier League with Swansea and worked under current Palace boss Ian Holloway during two loan spells at Blackpool.
Dobbie becomes Holloway's first signing of the summer and the former Hibs and St Johnstone midfielder, who started his career as a youngster at Rangers, is relishing another opportunity at top-flight football.
"I enjoyed my football last season here and I like to think I had a part in helping the team getting promoted," he told Palace Player. "But it's a new season now, that's in the past. We've just got to get ready in pre-season and get ready for that first game.
"It is every player's dream, especially in the Championship - they want to be playing in the Premier League. You go away and have a nice holiday, but still in the back of your mind, you've only got four weeks off, so maybe in a week and a half, you're going to know who you're playing in that first game.
"Then you start to look through all the other fixtures. I think we've got Man United, Liverpool and Chelsea all away in our first games against them, so the second part of the season will be exciting, especially for the fans."
Having played under Holloway in the past, Dobbie is also looking forward to continuing their strong working relationship. "Obviously I've worked with the gaffer a number of times and there was no problem with that," he said.
"A lot of people don't see the side to the gaffer that we do - on the pitch, on the training field, on the bus and in the changing room.
"We know what he's like and we know how good he is tactically. You just have to look at the play-off semi-finals and the final, how the boys played the way he wanted and we got the right result. I'm sure he'll be buzzing and raring to go."
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- Ian Holloway
- Premier League