The X Factor judge contracted the tropical disease while on holiday in Tanzania with dancer pal Derek Hough, 25, last month.
Cheryl, 27, has been kept in intensive care since Sunday and doctors fear it could take 6 months for her to make a full recovery.
'It is a lot more serious than first thought,' her rep tells The Sun.
'Everyone thought she would pull through after 24 hours but there have been no signs of improvement.
'She is very ill and will not be out of hospital for a while. Everyone is holding their breath.
'Because of her hectic schedule, the malaria has really taken a hold. She has not got the physical strength to beat it. She is going to need all of her Geordie grit to win this battle.'
Cheryl has been forced to pull out of recording The X Factor auditions in Manchester this weekend.
'Simon said that her health is her priority,' a spokeswoman for Simon Cowell, 50, tells the Daily Record.
'There's no pressure and to make sure she gets some proper rest. They have spoken privately and are in touch.'
Derek, 25, and Cheryl's mum Joan Callaghan have been keeping a bedside vigil.
Where to next?
- Facts on malaria
- Summer health tips
- X Factor 2010 first pics
- Cheryl holidays with Derek
- Cheryl Cole: From Popstars to superstar in pics