Palace; who are doing well in the Championship and look good odds for promotion have paid £750,000 for Ifill.
Blades boss Neil Warnock told sufc.co.uk 'We'd like to wish Paul all the best and thank him for his contribution in helping the club to where we are now.'
Ifill, 27 played 32 (+ 11 as sub) and scored nine goals for the Blades since he joined from Millwall in July 2005.