The Eagles went in front through a Darren Ambrose screamer, but appeared to have missed their chance when Federico Macheda levelled from the penalty spot. Yet Glenn Murray converted an extra-time header to send the South London club into raptures.
Such results have been rare in Sir Alex Ferguson's 25-year reign, especially at Old Trafford.
Here, we unearth United's 10 worst home defeats under Ferguson.
Manchester United 1-2 Nottm Forest - First Division - April 20, 1992
Hard to believe there was time when some people wondered if United would ever win a league title. It was 25 years since their last championship when United entered the final stretch of the 1991/92 season looking like this was the year they would end the drought.
Enter Nottingham Forest, who went in front through Ian Woan, courtesy of a mistake by Peter Schmeichel. Brian McClair drew United level, but Scot Gemmill fired home from the edge of the box to send United into despair.
Two days later they lost 1-0 at West Ham, and a 2-0 defeat at Anfield the following weekend handed the title to United's bitter rivals Leeds.
Manchester United 0-3 York City - League Cup - September 20, 1995
If the defeat to Palace was embarrassing, the thumping at home to York was cataclysmic. Third-tier York defeated a team containing David Beckham, Ryan Giggs and Phil Neville among others.
Two goals from striker Paul Barnes and another from Tony Barras completed an incredible result in the first leg of this second round tie. United won the return fixture 3-1 at Bootham Crescent but York went through.
Manchester United 0-1 Fenerbahce - Champions League - November 20, 1996
United boasted one of the proudest records in European football, having not lost at home for 40 years when Fenerbahce visited in the group stage.
After 56 teams had tried and failed to beat United on their own patch, the relatively unheralded Turkish side triumphed through a solitary Elvir Bolic goal.
The result followed humiliating defeats to Newcastle - 5-0 - and Southampton - 6-3 - completing a miserable spell for Alex Ferguson.
Manchester United 2-3 Derby County - Premier League - April 5, 1997
Later that season, United were on course for a Premier League title when unfancied Derby came to the Theatre of Dreams. Another win would keep up the momentum, but they were not bargaining on a virtuoso performance from little-known Costa Rican Paulo Wanchope, who scored a remarkable solo effort as Derby created one of the shocks of the season.
Strikes from Ashley Ward and Wanchope gave Derby a commanding lead, and though Eric Cantona and Ole Gunnar Solskjaer hit back for United, Dean Sturridge sealed the win 15 minutes from time.
Manchester United 0-1 Arsenal - Premier League - May 8, 2002
One of the most painful defeats of Ferguson's reign, at the height of the feud between the two clubs. When Arsenal rolled into Old Trafford, United knew they needed a win to keep the title race alive.
What transpired was a 1-0 defeat, with the only goal scored by Sylvain Wiltord. Arsenal were champions, and celebrated their triumph on the pitch of their closest rivals - spawning the beloved chant:'We won the league in Manchester'.
Manchester United 1-3 Chelsea - Premier League - May 10, 2005
2004/05 was a tough season for United, who fell well off the pace and finished third, 18 points behind Chelsea.
Ferguson chose Chelsea's late-season trip to Old Trafford as an opportunity to make his players feel the pain, making them form a guard of honour for the visitors.
There was more agony on the pitch as United were outclassed by the champions. After Ruud van Nistelrooy gave the Reds an early lead, Tago, Eidur Gudjohnsen and Joe Cole ensured nobody was in any doubt who were top dogs in England.
Manchester United 0-2 Coventry - League Cup - September 26, 2007
A year after losing to Southend in the Carling Cup, Ferguson resolved not to let it happen again. But he was left to watch in disbelief as Championship side Coventry silenced a 74,000-strong Old Trafford crowd.
Two Michael Mifsud goals made the difference, and the defeat prompted something of a clearout at United.
Phil Bardsley, Danny Simpson, Chris Eagles and Dong Fangzhou were swiftly moved on - as was a certain Gerard Pique, who was embarrassed by Mifsud but went on to become one of the most stylish defenders in the world at Barcelona.
Manchester United 1-4 Liverpool - Premier League - March 14, 2009
They might have gone on to win the title, but this defeat against a supposedly ailing Liverpool side stung, badly.
Cristiano Ronaldo opened the scoring from the penalty spot, but from then on it was all Liverpool. Fernando Torres headed the visitors level, then Steven Gerrard converted from the penalty spot - kissing a nearby camera in celebration.
United stalwart Nemanja Vidic was sent off late on, Fabio Aurelio scored a free-kick, and by the time Andrea Dossena lobbed Edwin van der Sar from the edge of the box, the Mancunian misery was complete.
Manchester United 0-1 Leeds United - FA Cup - January 3, 2010
Not so long ago a major force in the English game, Leeds were a third-tier outfit when they were handed a trip to Old Trafford in the FA Cup third round.
Ferguson fielded a strong XI featuring Wayne Rooney, but the visitors pulled off a smash-and-grab raid in the 19th minute when Jermaine Beckford scored the only goal.
A toothless United side failed to mount any sort of response, and Leeds could easily have doubled their advantage when a Robert Snodgrass free-kick cannoned back off the bar.
Manchester United 1-6 Manchester City - Premier League - October 23, 2011
The match described by Ferguson as his "worst day" at United, one in which everything that could go wrong did go wrong.
Mario Balotelli opened the scoring - before showing off his 'Why always me?' t-shirt, but it was not until Jonny Evans's red card early in the second half that the floodgates opened.
Balotelli got his second from close range and Sergio Aguero added another. Darren Fletcher pulled one back but City plundered three goals in the dying moments from Edin Dzeko (two) and David Silva as United's defence went AWOL.