He was without a club since leaving the Gunners at the end of last season.
"Crystal Palace is a very ambitious club with great players and I am looking forward to being part of that squad," Flamini, who won the Serie A title with AC Milan in 2011, told the club's website.
"It is a very interesting challenge for me and I am very excited to be here."
Palace, who have one point from their opening three league games this season, visit Middlesbrough on Saturday.
(Reporting by Ian Rodricks in Bengaluru; editing by Sudipto Ganguly)
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