"I couldn't be happier to sign on with Sydney FC. I am returning to my hometown and joining a club that is leading the way in Australian football," Carle said. "My focus is now purely on giving everything I have for Sydney FC. I am good shape and will work as hard as I ever have.
"I have the utmost respect for Vitezslav Lavicka and we already have a great relationship so I am looking forward to working hard under him and to keep the success going.
"The culture I saw at the club after just a few weeks of Vitezslav being coach was impressive and after all the recent success it is a club and an environment that has a special feeling about it.
"I want to be part of the club's continued success. I feel that I will be a big contributor. The challenge of defending the A-League title and playing in the Asian Champions League is something I am ready for and I feel Sydney FC is ready for."
Carle won the Johnny Warren Medal for the best player in the A-League in the 2006/07 season when he was with the Newcastle Jets before moving to Turkish club Genclerbirligi and then Bristol City in 2008. He then made the move to Selhurst Park with Palace where he has spent the past two seasons.