The designer prompted health concerns in January, when he missed Chanel's Paris haute couture shows, with another of the brand's directors stepping in for him.
Prior to that, he made a public appearance in late November to switch on the Christmas lights on the Champs-Elysées.
Karl took over as Chanel's creative director in 1983.
His illustrious fashion career began in the early 1950s, when he started working as an assistant to Pierre Balmain.
After stints at various fashion houses, he started working for Chloe in 1964, and collaborating with Fendi a year later.
While at the helm of Chanel, he's also designed costumes and stage outfits for megastars including Madonna and Kylie Minogue. In 2004, he lent his name and design skills to a collection for H&M.