The victim died as a result of an apparent self-inflicted gunshot wound. Olivia and her family were not at home at the time of the shooting.
Local police sergeant Scott Pascarella said on Monday that the 42-year-old victim didn't live at the house and was not a family member. He said that the man had permission to be at the property, but wasn't staying there.
The Palm Beach Post reported that construction was being done at the home near Palm Beach, and that a worker had been seen crying.
Police are investigating the death, although they have said it appeared to be a suicide.
The news will no doubt come as a blow to Grease star Olivia, who earlier this year postponed a series of concerts in Las Vegas to spend time with her sister Rona, who sadly later passed away from breast cancer.
Olivia herself has battled the disease; she was diagnosed with breast cancer in 1992 and underwent a partial mastectomy. She has been free of the disease for more than a decade.
She married John, her second husband, in June 2008. They first met 15 years previously before striking up a romance in 2007. The couple married in a private ceremony in Peru flowed by a legal ceremony nine days later on the Jupiter Island beachfront.
There were no guests at either ceremonies — only Olivia's daughter Chloe know of the marriage — and husband and wife announced the news at a 4 July barbecue at their Malibu home. Pictures of both ceremonies were published exclusively in HELLO! magazine.
Speaking at the time about her new husband, who is the founder and chairman of natural health firm Amazon Health, Olivia told HELLO!, "John is an extraordinary and special person, kind, sweet and loving.
"He has a lot of integrity and authenticity and I feel for him madly and deeply. He's thoughtful and attentive. He's one in a million and I couldn't be more enthralled that he is mine. I am the happiest woman in the world."