The midfielder lit up a dour encounter between two struggling sides with a sensational volley.
It eased Palace clear of the drop zone and left Micky Adams still looking for his first win as United manager after 10 matches in charge.
Palace have now not let in a goal at home in more than 12 hours and the Blades rarely looked like threatening that miserly record.
But in a game which both teams were desperate not to lose, it was going to take something special to break the deadlock and Ambrose was the man to provide it.
The midfielder has endured a stop-start season due to injury but crashed in his fifth goal of the campaign in style from 20 yards.
The opening stages suggested the visitors would make a decent fist of it, with Neill Collins heading a good chance wide and Palace full-back Nathaniel Clyne blocking Richard Cresswell’s effort on the goal-line.
But that was about as good as it got for the Blades.
At the other end Palace broke away when Wilfried Zaha played in James Vaughan, only for the Everton loanee to blaze over.
The Blades are now five points adrift of safety.
Blades boss Micky Adams said: “The wait goes on, not only for me but for the team.
“I’m sure I’ll get plenty of attention but I’m not worried about me, I’m worried about the team.
“But don’t write us off yet, we are not finished. I’ve taken on clubs in worse situations - Fulham were 91st in the pyramid and Coventry in the bottom three.”