The world is not an illusion according to Sankara. The world is relatively real (Vyavaharika Satta), while Brahman is absolutely real (Paramarthika Satta). The world is the product of Maya or Avidya. The unchanging Brahman appears as the changing world through Maya. Maya is a mysterious indescribable power of the Lord which hides the real and manifests itself as the unreal: Maya is not real, because it vanishes when you attain knowledge of the Eternal. It is not unreal also, because it exists till knowledge dawns in you. The superimposition of the world on Brahman is due to Avidya or ignorance.
Full Article: The World—A Relative Reality