The 26-year-old has put pen to paper on a three-year contract after Palace agreed an undisclosed fee with the Championship club.
Scotland international McArthur joins Tottenham defender Zeki Fryers in moving to Selhurst Park on Monday.
While Palace have not revealed the cost involved, the deal is reported to be for a fee of £7 million.
McArthur joined Wigan in 2010 and their boss Uwe Rosler has said that Palace's offer was too good to turn down.
In a statement on the club's official website, Rosler said: "James is a fantastic professional; we wanted to keep him but the offer was a very good one and we have made a decision which we feel is correct for the long-term benefit of the club. We wish him all the best."
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