The 86-year-old Velupillai, along with his wife, has been living in military protection in the Tamil-dominated Wanni region ever since the defeat of the rebel LTTE in May last year. The government has maintained that they had been kept in good conditions.
Velupillai died after a brief illness, army said today without giving further details.
Though his son led a violent 25-year campaign for creating a separate homeland for minority Tamils in the north and east, Prabhakaran's father served in the Sri Lankan government for 39 years, beginning his career as a clerk at the Ceylon Government Railways in 1943.
He received several promotions, retiring as Land Officer of the Land Settlement Department in 1982.
The LTTE supremo's parents, who were reportedly living in a welfare camp in Vavuniya with the relatives of other LTTE leaders, were found by the security forces after the annihilation of the rebel outfit in the military operation.
Prabhakaran was killed by the military in Nanthikadal lagoon in Mullaitivu on May 18 last year.
Prabhakaran's father married Vallipuram Parupathipillai (born on August 7, 1931) and had two sons and a daughter.
The "mild-mannered" Velupillai never endorsed the militant ways of his son and was not even on talking terms with him for a long period, a media report had claimed recently.
"The LTTE leader's father was a duty conscious mild-mannered gentleman well-respected and well-liked. People of Valvettithurai (where Prabhakaran hailed from) used to say that even the grass wouldn't get crushed when Velupillai treads on it," the Daily Mirror had reported.
"In fact, the father disapproved of the son's path and was not on speaking terms with Prabhakaran for years and years," the newspaper said.
Prabhakaran's family, which hailed from the coastal town of Valvettithurai in Jaffna district, generally referred as VVT, was of respected lineage.
His ancestors had constructed the famous Sivan temple of VVT. His father should have been the chief trustee of the temple but declined to be so as he was in government service, the newspaper had said.