The Northern Irish striker played under the former Italian international for Swiss side FC Sion last season having left Rangers due to the club's financial plight.
Gattuso was sacked by Sion in May after just three months in charge, paving the way for the relegated Rosanero to come calling for his services.
Lafferty said that the former Rangers and AC Milan midfielder convinced him of a move to Italy, where he will spearhead Palermo's bid to return to Serie A.
"Obviously it was Gattuso who played a big part in persuading me to move to Palermo," Lafferty told Sky Sports News.
"He spoke to me about a few things, where they want to be and hopefully I can go over there and score a few goals and help them win the league and put them back into Serie A.
"I am looking forward to it and once Italy came knocking on the door there was no decision to be made, it was always going to be yes. I am a Palermo player now and I can't wait to get started. Palermo is a massive club and should be in Serie A and not Serie B."
Lafferty has scored nine goals in 35 appearances for his country.