New Zealand Police said that David Millane, 62, died earlier this week in his hometown in England.
Miss Millane was murdered on the eve of her 22nd birthday after she went on a Tinder date while she was in New Zealand.
Her body was found in a suitcase buried in a forested area near Auckland on December 9, 2018.
The offender, who cannot be named for legal reasons, was handed a life sentence with a minimum term of 17 years in February this year, which he has since appealed.
Following the death of Ms Millane’s father, Detective Inspector Scott Beard said: “New Zealand Police wish to extend our deepest sympathy to family of David Millane who died earlier this week in his hometown in England.
“The Millane family had their lives turned upside down when David’s much-loved and cherished daughter Grace was murdered while visiting New Zealand in December 2018.
“NZ Police worked closely with the Millane family as part of the investigation into Grace’s murder and provided victim support throughout the subsequent trial.
“Our thoughts and sympathies are with Gillian, Michael, Declan and the rest of their whanau (family).”
Ms Millane had been in New Zealand for less than two weeks when she matched with the man on Tinder. She died the night they first met in person.
Her parents were forced to endure a three-week trial in Auckland. Her killer refused to give evidence and instead put Ms Millane’s sex life in the spotlight.
Ms Millane, a Lincoln University graduate, was on a round-the-world trip when she was murdered.
Additional reporting by PA Media.