Funicello, 70, died Monday due to complications from multiple sclerosis, a disease she battled for decades.
Avalon, who starred with Funicello in a string of iconic beach party films, said he first became aware she had the disease when they were working on their 1987 reunion film, "Back to the Beach," but her condition only got worse from there.
"For at least the past six, seven years, she was without communication. It was a terrible existence," Avalon told TV's "Inside Edition."
"It makes me smile to know that she's up there dancing and singing and having a good time."