The 22-year-old is now valued at £16m, and Palace would have to pay a compensation fee of £450,000 to acquire the midfielders' services.
The Germany worldwide joins Palace on a Bosman free after his contract expired and has signed a three-year contract reportedly worth £80,000 a week. Meyer had been unable to agree a deal with the Bundesliga side and had not trained with the team since April.
The 22-year-old has always been touted as one of the most promising talents in world football, so it comes as somewhat of a shock that Palace have won the race to sign the Germany global.
The Guardian's report states that Meyer is due to undergo a medical at Palace on Tuesday.
Meyer's time at Schalke came to an end after he fell out with the club hierarchy, who were not willing to meet his wage demands.
"I feel really good and I'm happy to be here", he told Cpfc.co.uk. I can't wait to start training with the team and I hope I'll have a good season.
This is still a major signing for the Eagles who are looking to make a big impact on the Premier League this year.
The 22-year-old had a relatively quiet season last term, but has earned his wonderkid status over the past five seasons he has played for Schalke.