Financial terms were undisclosed but media reports said Everton had paid an initial fee of 25m for the 27-year-old.
Bolasie, who joined Palace from Bristol City in 2012, follows recent new recruits Ashley Williams, Idrissa Gueye, Maarten Stekelenburg and Shani Tarashaj to Everton.
"It was a no-brainer to come here but now I've come to Everton, the job is not done. I've got to work hard and feel my way in. I'm ready and up for the challenge," he said in a statement.
WATCH: @YannickBolasie’s exclusive first interview as an #EFC player -https://t.co/cgHFEL4Gq7
— Everton (@Everton) August 15, 2016