Boselli had been tipeed for a big return to the Latics this season and despite having a run in the cup games, manager Roberto Martinez has restricted his league time.
A statement on the club's official website read: "Wigan Athletic can confirm that Mauro Boselli has joined Italian Serie A side Palermo on loan until the end of the season with an option to buy at the end of the term."
It is hoped that Boselli will perform for Palermo and attract a potential suitor who will allow the Latics to recoup the money paid for him.