Claudio Ranieri's men have been one of the most impressive sides this season, thanks in no small part to the inspirational form of their 28-year-old striker.
Vardy has scored nine goals in nine Premier League games this term, but Pardew believes that the division's "surprise package" remain dangerous even if Vardy struggles to impress.
"No, I don't think so," the Palace boss said when asked if keeping Vardy quiet ended Leicester's chances of victory.
"They have various offensive options, all of which are problematic.
"(Nathan) Dyer came off the bench, who I think's a terrific player, and changed the game a little bit against Southampton (in last weekend's 2-2 draw).
"They've got good offensive players, but (Vardy) is the sharpest striker in the division at the moment.
"Coming from where he's come from, the route to where he finds himself now is astonishing, it's a credit to the boy
He's done terrifically well."
Vardy has not been the only pleasant surprise at the King Power Stadium.
Ranieri's summer appointment as manager following the dismissal of Nigel Pearson led many observers to predict that Leicester would struggle.
However, the Italian has so far impressed in leading his team to fifth place, and Pardew has revealed his admiration for the manager and the start he has made.
"We're playing against a Leicester side who have been the surprise package," he said.
"I think with our signing of (Yohan) Cabaye people looked at us and perhaps thought we might have a good season, but I don't think everybody (could) see Leicester's season coming
They've done tremendously well.
"I'm a big fan of the manager, who carries himself really well and he's had big teams so he knows how to keep a winning run going and they're in a great zone at the moment.
"It's a really tough game, and a crucial game, in terms of us and Leicester because it will propel one above the other."
Source : PA
Source: PA