The two teams will meet at Wembley with the winners earning the right to join the Premier League next season with an accompanying £120 million reward, as sports business group Deloitte highlighted in its analysis of Hull City's automatic promotion.
The stakes could not be higher for managers Gianfranco Zola and Ian Holloway and their respective Watford and Palace clubs.
The Hornets were stung on the final day of the season when victory over Leeds United would have seen them promoted ahead of Hull.
But with Steve Bruce's team anxiously looking on after a draw with champions Cardiff City at the KC Stadium, the delayed kickoff at Vicarage Road saw Watford denied an automatic spot in the top flight as Leeds ran out 2-1 winners.
Watford were not helped in their quest by an injury to first-choice goalkeeper Manuel Almunia in the warm-up, but things went from bad to worse when his replacement Jonathan Bond was carried off the field after a collision with Ikechi Anya.
On came Jack Bonham for his debut, and he failed to prevent Ross McCormack's winner sailing between his hands in the closing minutes to deny Watford any hope of overhauling Hull into second place.
The real drama for Watford came in the playoff semifinal against Leicester City, however.
The Foxes had claimed a single-goal lead from the first leg at the King Power Stadium and looked set for Wembley as midfielder Anthony Knockaert won an injury-time penalty for the visitors with Watford leading 2-1 in the second leg.
But Almunia saved Knockaert's penalty and raced to the other end of the field where striker Troy Deeney, who had missed the first leg after his dismissal in the game against Leeds, fired home the winner.
It was a tumultuous way to ensure the short trip to Wembley on Monday as Zola and his team celebrated wildly in front of the supporters at Vicarage Road.
While Watford were contesting automatic promotion in the final throes of the normal campaign, Palace were treading a thin line between success and failure courtesy of a run of nine league matches without a win until they defeated Peterborough on the final day of the season.
Palace faced up to fierce rivals Brighton in the semifinals and looked to be on their way out as the Seagulls claimed a 0-0 draw at Selhurst Park in the first leg.
But Manchester United-bound Wilfried Zaha revived Palace at the Amex Stadium and scored twice to send the South London side through to Wembley.
Zaha was bought from Palace by the Old Trafford club in January but was immediately loaned back to the Eagles by Sir Alex Ferguson until the end of this season.
His form in the first half of the Championship season was sensational as he provided much of the ammunition for Glenn Murray, who has scored 30 times in the league this season, according to statistics at BBC Sport.
Zaha will have a point to prove as he bids farewell to Palace in the biggest game of their season.
Manager Holloway has been here before, on more than one occasion. He guided Blackpool to a famous win over Cardiff City in the 2010 Championship final and then again last season as the Seasiders were beaten by West Ham United.
The former Leicester and Queens Park Rangers boss succeeded Dougie Freedman in the Selhurst Park hot seat in November, and his arrival initially extended their successful run to nine wins in 11 matches.
Watford hold the psychological advantage after a 3-2 defeat of Palace at Vicarage Road on the opening day of the season was followed by a 2-2 draw at Selhurst Park in February.
Few will argue with a Watford victory for Zola, whose team finished third in the table, but Holloway knows his way around the playoff system while Zaha has promotion in mind as he signs off from Palace.
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