An Owen Garvan penalty had given the visitors the lead until two goals in the last five minutes from Elliot Grandin and Chris Basham gave Ian Holloway's men a last-gasp win.
The opening 20 minutes of the game contained few highlights, although Kieron Cadogan came close to creating a chance with a teasing ball across Blackpool's six-yard box.
At the other end Craig Cathcart failed to connect with the ball cleanly when presented with a chance inside Palace's penalty area.
Cadogan was involved seven minutes later too when his shot was blocked by the hand of Barry Ferguson according to the referee, who duly pointed to the spot.
Up stepped Garvan who made no mistake, blasting the ball past Matt Gilks.
Blackpool tried in vain to find an equaliser before the half-time interval, with Ludovic Syvestre and Tom Ince both squandering decent chances before the break.
They began the second half in similar fashion, with Taylor-Fletcher just failing to connect with a dangerous ball from Matt Phillips.
A counter attack from the visitors almost led to Garvan getting his second of the game, but the Palace man fired wide.
Palace continued to push for a second goal with Calvin Andrew and Ibra Skeajja both missing good chances before Ian Evatt fluffed an opportunity to bring the home side level.
Blackpool manager Ian Holloway decided it was time for a change just after the hour mark, making a triple substitution that almost paid immediate dividends when Kevin Phillips was only denied by a good Lewis Price save.
Another one of the substitutes, Basham, then came close to levelling the sides but he was also denied by Price.
The Tangerines didn't have to wait long for their equaliser, however, as just one minute later Elliot Grandin surged into the penalty area and smashed the ball past Price to make it 1-1 in the 85th minute.
They completed their late comeback in the 90th minute after Kevin Phillips hit the ball with a header before Basham slid in to give the home side a dramatic victory.