The ex-Rossoneri attacker has lost his battle with Amyotrophic Lateral Sclerosis (ALS), with Italy set to wear black armbands during Thursday night's Confederations Cup semi-final
Italy face Spain on Thursday in the Confederations Cup semi-final, and will wear black armbands in memory of the Borgonovo, who earned three caps for the Azzurri.
Milan released a statement saying: "The spirit of Stefano will always be with us. Everybody at the club is thinking of his wife Chantal and their children Andrea, Alessandra, Benedetta and Gaia. They are a splendid family with strength and honour.
"He was a dear friend of Carlo Ancelotti, Mauro Tassotti, and Adriano Galliani and Silvio Berlusconi were also very close to him.
"The whole of Milan has worked with his foundation and will continue to work with Chantal to do even more now that Stefano is no longer with us."
The father-of-three was diagnosed with ALS in 2006 - an affliction which he later described as "the monster"- after it left him completely paralysed.
From his bed, Borgonovo wrote his autobiography entitled 'Attacante Nato' (Born Striker) through his computer which he could only control with his eyes.
Following the diagnosis, Borgonovo had set up a non-profit foundation in his name to raise awareness and funding to fight the disease.
In 2008, Milan and the Fiorentina faced off in a testimonial in a bid to aid their former player's fight against his illness.
In addition to spells with Fiorentina and Milan - the latter of which he won a European Cup with in 1990 - Borgonovo also enjoyed spells with Como, Sambenedettese, Pescara, Udinese and Brescia.