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Despite featuring regularly for the Pars Reserve side, Lyle failed to make even one appearance for the Pars this season, the striker featuring as an unused first team substitute several times.
Signed on a six-month loan by Jimmy Calderwood shortly before the ex-Pars gaffer left the club, Lyle has resigned for Queen Of The South until the end of the season and is likely to feature in Queen's game against Clyde tomorrow.
In other news, another Pars striker has departed the club with youngster Patrick Clarke joining Berwick Rangers on loan.
Clarke's performances for the Pars U21 side last season was enough to convince ex-Pars coach Sandy Clark to take the youngster to the second division club on loan in attempt to boost the club's fortunes, with Berwick sitting rock bottom of the division.