Former England centre-half Cahill, 35, who signed a two-year deal when joining Palace from Chelsea in August 2019, announced he had left Selhurst Park on Twitter.
Cahill said: "After much thought and deliberation, I can confirm that I have left Crystal Palace FC after an enjoyable two years.
"I have really enjoyed my time at the club and I want to extend my sincere thanks to everyone involved at the club, especially the fans and staff who welcomed me into their South London family.
"It's been a privilege to play at Selhurst Park, especially in that first season where I got to experience the atmosphere that the Eagles fans create on a match day.
"Playing in front of the Holmesdale Road stand is a memory that I will cherish in particular. I would like to wish the club all the best for the future and wish them every success for the coming season."
Injury restricted Cahill to 20 top-flight appearances for the Eagles last season under Roy Hodgson, who was replaced as manager by Patrick Vieira early last month.
Former Aston Villa and Bolton defender Cahill, who won 61 caps for England before stepping aside from international football in 2018, had spent seven years at Stamford Bridge.