The 29-year-old, however, will now reunite with Alan Pardew, having worked with the manager at Newcastle United, in a bid to rediscover his scoring touch.
"We had a good time together (at Newcastle) and I'm pleased to be back under him because I think he is a very good manager. He can give me a lot, and I hope to do the same for him and the team," Remy told the club's website (www.cpfc.co.uk).
"It's a really good opportunity for me. I was at Chelsea for two years and it was a bit complicated because I didn't play that much, so it is very good to be here now and hopefully I'll have some chances to play.
"After three years without playing much the main thing is to get back fit, and after that there will be no problem because I know what I can bring to the team."
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Remy also hopes to build a strong partnership with fellow striker Christian Benteke, who joined Palace for a club record fee 27 million pounds earlier this month.
"Benteke is a very good player and is very strong so I'm sure that we can play together. I think the choice to buy us two strikers is going to be a good one," Remy said of the Belgian.
(Reporting by Shravanth Vijayakumar in Bengaluru; Editing by John O'Brien)
