SATV 14 July, Kathmandu: Champions League winners Paris Saint-Germain were strong favourites, having thrashed Real Madrid in the semi-finals, but Chelsea scored three times in a clinical first-half display to earn the title of world champions to follow their Conference League win.
Palmer had a hand in all three goals, scoring the first from Malo Gusto's cut-back with a superb, low finish and adding the second with a near-identical strike only eight minutes later.
He then played in new signing Joao Pedro, who followed up his two-goal performance against Fluminense with a cool finish over Gianluigi Donnarumma as Paris Saint-Germain, who had Joao Neves sent off for pulling Marc Cucurella's hair late on, were left stunned.
Joao Pedro embraces Palmer after scoring the third
The victory, in front of watching US president Donald Trump, sees Chelsea bank around £100m in prize money from what was the first edition of the competition in its expanded, 32-team format.
Paris Saint-Germain came into the game hoping to complete a quadruple, six weeks after thrashing Inter 5-0 in the Champions League final, but could not handle Chelsea's intensity as Enzo Maresca's side ruthlessly targeted their left flank.
In a showpiece fixture which featured glitzy pre-match build-up, a fighter-jet fly-past and a lengthy half-time show which extended the interval to 24 minutes, breaching IFAB regulations, Chelsea looked sharper and more dangerous from the start.
After their first-half flurry of goals, they could have extended their lead late in the second when substitute Liam Delap forced two saves from Donnarumma. At the other end, Robert Sanchez also produced some fine stops but the result never looked in doubt, despite the pre-match odds heavily favouring Chelsea's opponents.
Palmer celebrates with teammates after scoring vs PSG
Paris Saint-Germain's frustration boiled over, first with the Neves red card, awarded after the referee was sent to the monitor, and then when a brawl broke out between the players after the final whistle.
Once the commotion died down, though, it was time for Chelsea's fans and players to celebrate a triumphant end to an epic season.
In pictures: Trump gatecrashes celebrations
Reece James was expecting US president Donald Trump to move aside
US president Donald Trump looks on as Chelsea captain Reece James lifts the Club World Cup
