Palace are seeking to replace Neil Warnock – sacked on 27 December – and Pardew, a former Palace player, is their first choice to become their new manager.
Pardew has been at St James’ Park for four years, and he is currently over two years into an eight-year contract, so Palace will have to strike a deal with Newcastle to release him from it.
Talks have been made more difficult because Newcastle owner Mike Ashley is on holiday in Barbados but there could be an agreement between the two clubs as soon as Monday evening or Tuesday morning.
Earlier on Monday, Ajax boss Frank de Boer was installed as favourite to become the new Newcastle boss if Pardew moves to Palace.
But De Boer’s agent has said that he will not leave the Dutch giants this season.
Speculation over Pardew’s future has intensified since he failed to attend the post-match press conference following Newcastle’s 3-2 home win over Everton on Sunday.
Former Palace manager Tony Pulis and Hull boss Steve Bruce have also been linked with Newcastle if Pardew, who made 100 appearances during a four-year spell with Palace, calls time on the club after four years in charge.
Pardew made 128 appearances for Palace between 1988 and 1991 and scored the winning goal in his side’s famous FA Cup semi-final win over Liverpool in 1990.
Pardew is scheduled to host his regular pre-match press conference ahead of the visit of Burnley at Newcastle’s training ground on Tuesday afternoon – at around the same time Palace preview their next match against Aston Villa.