Gabor Kiraly is set to move to Manchester City, following the Hungarian keeper’s abortive transfer to Palace.
City boss Kevin Keegan has lost summer signing Geert De Vlieger to a season-long injury, and desperately needs cover for David James.
Kiraly is still available on a free transfer after leaving Hertha Berlin and turning down a contract offered to him by Palace.
"As far as I know, Kevin Keegan phoned to say that he would like to sign me," Kiraly told Nemzeti Sport. "City are not in an easy situation because they only have one keeper."