Novo was taking part in the AOK Traditionsmasters five-a-side tournament in Berlin alongside former Ibrox legends Charlie Miller, Jorg Albertz, Michael Mols and Andy Goram.
The 38-year-old, who hit 73 goals in 255 appearances for Rangers during a six-year stint between 2004 and 2010, thought he had picked up a chest infection, according to reports.
A friend of Novo’s told the Daily Record: “It was a heart attack and although they are enormously serious we hope it was relatively minor.
“Nacho is recovering well and still in intensive care and it looks like he will remain in hospital for the next week or so.”
Rangers were the only non-German side to send a team to the tournament at the Max-Schmeling-Halle in the German capital on Saturday.
Managed by John Brown, the Rangers side finished the tournament empty-handed and without a single point after going down 5-3 to Hertha Berlin, and 7-3 to eventual winners Union Berlin in the opening stages.
Novo had recently opened a Rangers-themed bar in Glasgow.