The 29-year-old is due to undergo a medical at Selhurst Park on Wednesday.
Palace boss Ian Holloway has been looking to recruit a new striker to bolster his newly-promoted side's firepower for their first Premier League campaign since 2004/05.
Cole has been looking for a new club since being released by West Ham this summer.
He has been linked with a number of English clubs, including West Brom and Hull City, along with Turkish side Besiktas.
Former Chelsea forward Cole scored 47 goals in 227 appearances for the Hammers.