The 70-year-old actor was bedridden for quite some time, hospital sources said.
He is survived by wife and two children.
Rajappan, who acted in over 50 Malayalam movies, was known for his unique style of presenting 'Kadhaprasangam' in a satirical manner. He was the centre of attraction at festival grounds in Kerala at the peak of his career in 1970s and 80s.
His memorable comedy 'Kadhaprasangams' include 'Kumari Eruma', 'Mak Mak', 'Priye Ninte Kura', 'Amittu', 'Pothu Puthri' and 'Ennennum Kurangettandeh.'
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