The Wales international initially moved to Portman Road on a month's loan, which is set to come to an end after Saturday's home clash with Nottingham Forest.
Williams has featured in three wins from his five Ipswich appearances and grabbed his first goal for the club in a shock 2-1 triumph over Derby County on Tuesday.
Having struggled to make an impact at Palace this season, despite playing a crucial role in their promotion last term, Williams is hopeful he can contribute to another promotion push with Ipswich sat just two points off the Championship's top six.
"If everything is right for me, Ipswich and Crystal Palace then I don't see why the loan can't be extended," the midfielder told the club's official matchday programme.
"I will be having a chat with both managers to see what the prospects are of me extending the loan.
"We will see what happens when that comes around but I'd like to stay at Ipswich if everyone is happy for me to do so."
Ipswich boss Mick McCarthy is also impressed with what he has seen from the 20-year-old, and is pursuing an extension to his stay at the club after his goalscoring impact.
"It was a great goal from Jonny, he's a fantastic lad and a fantastic footballer," McCarthy told the club's official website.
"Tony Pulis was here tonight (Tuesday) and I'm just a bit concerned whether he sees Jonny has doing something with Palace after his loan is up here.
"We will have to see."
