Zaha returns to Palace after just two appearances for United following his unsuccessful £15 million ($24 million) transfer from the south London club last year.
The 21-year-old is Palace manager Neil Warnock's first signing in his second spell at Selhurst Park following his appointment earlier this week.
"There's a nice vibe around and I'm happy to be here. I was happy when I was here before," Zaha told Sky Sports News.
Warnock added: "I think Wilfried needs us like we need Wilfried. He's been at a big club like Man United, and it is a big club, and he's probably got a bit lost in the chambers there.
"He could have gone to three or four clubs and I think people think wrong of him at times with what they say about his attitude.
"Wilfried has always had a great attitude for me. He wants to learn he wants to do extra training so we are going to let him do that."
Ivory Coast-born Zaha made more than 100 appearances in three years at Palace after progressing through the junior ranks at Selhurst Park.
Zaha was signed by then-United manager Alex Ferguson in January 2013 and was then loaned back to the Eagles as they won promotion to the Premier League via the Championship play-offs.
Once Ferguson retired, Zaha was only able to muster two appearances for United last term under then-boss David Moyes and spent the second half of the campaign on loan at Cardiff, who were relegated from the top-flight.
He has since been deemed surplus to requirements by United's new manager Louis van Gaal, paving the way for another stint at Palace.