The 26-year-old, whose cause of death is yet to be confirmed, was also a contestant on Celebs Go Dating and a former semi-professional footballer for Stevenage.
A spokesman for ITV, which produces Love Island, said: "Everyone at ITV2 and Love Island are shocked and saddened by this terrible news. Our thoughts and deepest condolences are with Mike's family and friends at this very sad time."
Kem Cetinay and Amber Davies, winners of the 2017 series in which he appeared, tweeted their tributes on Twitter, calling it heartbreaking.
His appearance on the 2017 series earned Thalassitis the nickname "Muggy Mike" after partnering with fellow contestant Chris Hughes's girlfriend, Olivia Attwood.
Hughes reacted to news of his passing by tweeting: "His name wasn't Muggy Mike. Please stop brandishing that.
"His name was Mike Thalassitis, and every inch of my heart goes out to his family & friends. A good guy, taken far, far to soon."
His name wasn’t Muggy Mike. Please stop brandishing that. His name was Mike Thalassitis, and every inch of my heart goes out to his family & friends. A good guy, taken far, far to soon. ?
His former football club, Stevenage, said everyone there was "shocked and saddened".
Calum Best, former Celebrity Love Island contestant and son of footballer George Best, tweeted: "Jesus that's so sad, rip mike. Way too young. Thoughts and prayers with his friends and family."
Love Island host Caroline Flack shared her condolences, saying he was a "total gent".
There had been speculation that the pair were at one time romantically linked.
Thalassitis split from The Only Way Is Essex star Megan McKenna late last year.
His death comes two months after his best friend Danny Cutts passed away, on Christmas Eve.
It has also been reported that his grandmother, who he lived with in order to care for her, passed away just two days before his death.
Cleaning Up star Sheridan Smith, 37, said Thalassitis's death should be a "massive wake up call".
Writing on Twitter, the BAFTA award-winner asked fans to reach out to their friends, even those who might outwardly appear confident and happy.
"This should be a massive wake up call," she said.
"I feel sick, reach out, sometimes to the most confident friend. We can only learn & try to change."
In June last year Sophie Gradon from the second series of Love Island passed away.
Thalassitis was set to open a restaurant called The Skillet in Essex with former professional footballer Scott Neilson, according to filings at Companies House.