The Newcastle manager believes the France international's interests would be best served at St James' Park as the midfielder continues to be linked with a move away.
The France international refused to play in Premier League games against Manchester City and West Ham at the beginning of the season after the Magpies rejected a bid from Arsenal.
However, Cabaye has since settled his differences with the club and has played an integral role in an impressive campaign so far, with his four goals helping the club move up to sixth place in the league table.
Cabaye's performances have led to renewed speculation that he could be on the move in the January transfer window, but Pardew has warned the 27-year-old against leaving St James' Park.
"He's in an environment where he's got pole position," the Newcastle boss said. "You don't always get that. You can get lost at some clubs."
Ligue 1 champions Paris Saint-Germain and Premier League leaders Liverpool are just two of several clubs to have been linked with a move for Cabaye.