He was 63.
The Connecticut-born actor's friend Stacy Sacco confirmed his sudden death Tuesday to the Palm Beach Post.
No cause has been disclosed yet, but Sacco said he had not been in poor health.
"He just couldn't have been more fun and intelligent or talented. He was an amazing human being," Sacco told the Post, recalling how she met him 20 years ago when he was a guest star on "Ellen" and Sacco was the sitcom's script supervisor. "I had been a fan. We all knew who he was. He was a shining star."
The newspaper said Palillo spent the last three years teaching acting classes at G-Star School of the Arts, a charter school in Palm Springs.
He is survived by his partner of 41 years, Joseph Gramm, a retired actor, the Post said.