Neil Warnock's promising young side put an end to Town's ten-match unbeaten run thanks to goals by Jose Fonte, Neil Danns and Victor Moses.
However, it was not all plain sailing for Palace as Jaime Peters gave Town a 19th-minute when he capitalised on a Julian Speroni error.
After a drab opening to the match, the 22-year-old Canada international volleyed the ball home after Speroni had flapped at a free-kick.
The goal seemed to spark both teams into action and it was the Eagles who deservedly grabbed an equaliser seven minutes before half-time, when Fonte expertly volleyed past Arran Lee-Barrett after a long throw had not been properly cleared by Damien Delaney.
Just 60 seconds later Roy Keane's side were reduced to ten men when former Huddersfield Town and Blackburn Rovers striker Jon Stead was sent off for a rash challenge on Freddie Sears.
Stead appeared to be taking retribution after being felled by Claude Davis seconds earlier and replays of the incident showed that the striker's studs were up when he made the challenge.
Just before the half-time whistle, Fonte almost netted again when Owen Garvan was forced to clear the ball off the line.
The second half was certainly not one-way traffic but Warnock's side did dominate proceedings.
They deservedly took the lead just before the hour mark when Delaney failed to deal with a Moses cross and Danns profited as he ran on to the ball and slotted his shot past Lee-Barratt.
Palace secured the three points in stoppage time with a third goal after Clint Hill and Moses had both gone close.
Danns was the provider this time, crossing the ball in for Moses to sidefoot it past Lee-Barratt from 12 yards for his fifth goal in six games.