And the pundit believes half of Palace's first team would get into the Tottenham and Liverpool sides.
Indeed, Merson has been mightily impressed by Alan Pardew's south London side so far this season and feels their lack of European games, as well as the quality of their squad, could well take them to Europe next term.
Predicting the Eagles to finish as high as fifth in the Premier League in the light of the transfer window, Merson told Sky Sports: "I like Crystal Palace and if they stay fit as a team, they won't be a million miles off. They're not in Europe and they've got very good players.
"People are going to say they won't be up there because they're not Tottenham or Liverpool but half of their players would get into Tottenham or Liverpool's team."
A look at the Crystal Palace team that beat Chelsea at Stamford Bridge suggests Merson may not be too wide of the mark. The simple fact Pardew's men even beat Jose Mourinho at the Bridge - something Liverpool and Tottenham have never done - is already evidence in itself.
Alex McCarthy, shielded by a solid back four, is a top talent in goal, while the likes of Bakary Sako and Jason Puncheon won't be bettered for pace or skill by many. Away from the more hard-working players in the Crystal Palace line-up, meanwhile, Yohan Cabaye would walk into the Spurs or Liverpool midfield.
Can Palace finish as high as Merson is predicting, then?