While no details of his malady have been revealed, Mr Flatley was admitted to a private hospital in London two weeks ago in a critical condition.
This week, his sold-out Celtic Tiger tour of Dublin and Europe was cancelled.
In April, the 48-year-old said he had contracted a facial skin cancer but was over the condition. It is understood that his current illness is unrelated to the cancer.
One English newspaper quoted an unnamed source as saying: “Michael is a very fit man but he is in the fight of his life. At first no one realised how serious it was but it soon became obvious that he is really ill.”
Last night, Mr Flatley’s wife Niamh O’Brien, 32, remained at his bedside.
The couple tied the knot in a lavish ceremony presided over by Fr Aidan Troy, parish priest of Holy Cross in North Belfast.
The wedding bash was staged at his Castlehyde mansion outside Fermoy in North Cork.
Another British newspaper quoted an unnamed friend of Mr Flatley as saying: “Doctors are still running tests to figure out if the infection is bacterial or viral. But they are calling it an all-system infection. His condition deteriorated very quickly and he was rushed to hospital. Doctors have already told him it’s unlikely he’ll be able to dance again for at least three months.”
Mr Flatley’s parents recently returned to Chicago from Castlehyde following his wedding and are being kept closely informed of their son’s health.
Mr Flatley’s new wife is a member of his Celtic Tiger dance troupe. The couple first met on the set of Riverdance in 1993, but only became an item earlier this year.
Mr Flatley shot to fame in Riverdance before going on to create his own shows Lord of the Dance, Feet of Flames and Celtic Tiger.