France international Cabaye had to sit out the 1-1 draw with Southampton after picking up a fifth booking of the season in his match-winning display at Manchester United.
But he returned at Selhurst Park and opened the scoring as the Magpies secured an easy 3-0 win, with a Danny Gabbidon own goal and a late Hatem Ben Arfa penalty settling the game.
It is a far cry from when Cabaye looked set to leave for Arsenal and was jeered by the Newcastle fans with Pardew praising the 27-year-old's character and the impact he has on his sixth-placed side.
"I was honest with him all the way along," said Pardew.
"The bottom line is the player has a true character and he added an x-factor for us today. When you are at the top of the Premier League you can't stay there unless you have got x-factor and he gives us that.
"We have just got a team that believes in what it is doing, it has a functionality about it that is thorough in terms of its professionalism, no-one is shirking responsibility. It is making us a difficult team to undo."
Moussa Sissoko was another stand-out player and Pardew also reserved special mention for defenders Fabricio Coloccini and Mathieu Debuchy as his side kept a third clean sheet in their last four away fixtures.
"We had a game plan to try and take the sting out of the pressure they exert on you and we couldn't have done it any better really," he added.
"The players were very accurate with their passing today and we looked comfortable almost from the kickoff, but you still need great players to play well and we had some outstanding players out on the pitch today.
"I thought Coloccini and Debuchy were outstanding in their positions. It is difficult to single out individual players because it was such a great team performance and it was a sweet feeling for me to come back to a club that I love and see my team play like that."
For Palace manager Tony Pulis it was a first home defeat since he replaced Ian Holloway at Selhurst Park at the start of last month.
His side offered very little in attack but it was the Eagles' defending that left Pulis wanting more.
"The two goals we conceded were poor," he said.
"The one thing we have been since I came here is pretty solid and disciplined in coping with most things but today we have gifted them two poor goals.
"From that point onwards we are chasing the game against a team I feel will finish in the top eight."
With two home league wins out of two going in to the match Pulis knows home form will still be a factor if Palace, who remain 18th in the table, are to survive.
"You have to do well at home," he added.
"The next two games at Villa Park and Man City will be tough, tough games so we have to do well here and we can't be gifting teams goals."