The winger has been on loan with the Eagles since last August and now heads to Selhurst Park on a full-time basis.
Londoner Puncheon moved to the south coast on 1st February 2010, hitting the ground running with a number of impressive performances that led to him being named in the PFA League 1 Team of the Year come the end of the season.
However, a change of management near the start of the 2010/11 campaign led to Jason falling out of favour, so he departed for a loan spell in the Championship with Millwall, where he netted five times in seven games before returning to St Mary's in January.
Punch was on the move again at the start of 2011, heading into the Premier League to sign on loan for Blackpool. There he scored three times in 11 appearances, but could not prevent the Tangerines from being relegated on the final day of the season.
Another temporary move to the top flight would follow for Puncheon, as he signed for Queens Park Rangers on transfer deadline day in August. However, his spell in west London was an unsuccessful one, as he made just two substitute appearances.
The wide-man was welcomed back into first-team contention upon his return to Southampton, making nine appearances as the Club sealed promotion to the Premier League.
Impressive showings during pre-season ahead of the 2012/13 campaign saw Puncheon start the opening game of the season away at Manchester City, with his first top-flight goal for Saints coming against Aston Villa a month later.
He would go on to score in vital victories over QPR, Reading and Manchester City, as well as netting dramatic late equalisers in draws with Chelsea and Sunderland.
Overall, Puncheon made 34 appearances and scored seven goals in 2012/13, winning the Goal of the Season award for his goal at Stamford Bridge last January.
However, the continued development of James Ward-Prowse and Jay Rodriguez meant he started the 2013/14 on the fringes of the starting XI, leading to him heading back to his home city towards the end of August.
Since moving to Palace, Puncheon has played 22 times and scored three goals, including three in his last six matches as the Eagles have climbed out of the Premier League’s relegation zone.
The 27-year-old leaves Saints one day short of four years at the Club, having made 81 appearances and scored ten goals in that time.
Everybody at Southampton Football Club wishes Jason the very best for his future career and thanks him for the role he played in helping the team on its journey.