Customers who have travel credit with Tigerair will be able to put it towards flights operated by Virgin Australia, the airline said.
Tigerair's demise was announced by Virgin Australia last month as it outlined its road map out of voluntary administration under its new owner Bain Capital.
Virgin said there was "not sufficient customer demand to support two brands at this time" but it would retain Tigerair's Air Operator Certificate so there was the option of reviving it in the future "when the domestic market can support it".
All Tigerair flights were grounded during the COVID-19 pandemic and its pilots were made redundant in a restructure announced by Virgin in March.
Virgin acquired Tigerair in 2014 as it shed its budget origins and grew into a full-service airline. It paid Singapore Airlines $1 for full ownership of the discount carrier.
The budget carrier, based in Melbourne, operated domestic routes to Australia's capital cities and key regional centres and was the only direct competitor to Qantas' Jetstar.
Online, Australian flyers shared memories of flying with Tigerair and lamented the end of its super-cheap airfares.
The news comes a day after Virgin Australia announced it was slashing a string of regional routes as part of its restructure.
The airline said flights will be cut from Ayers Rock (Uluru), Albury, Tamworth, Hervey Bay, Mildura, Cloncurry and Tonga "for the foreseeable future".
"With the changes to simplifying our fleet and ongoing subdued customer demand, we have been required to make some adjustments to our network," a Virgin spokesperson said.
"We remain committed to regional Australia and we plan to continue to fly to 20 regional destinations in Australia. We will continue to review our network as travel restrictions ease and demand returns.
"We will contact affected guests who booked with us to advise them of their options. Guests who booked with a travel agent will need to contact them directly."
US private equity firm Bain Capital's $3.5 billion plan to take over the airline was accepted by creditors at a meeting last week.
Under Bain, Virgin Australia will cull 3000 jobs and several aircraft as it rebrands as a "value airline" with a focus on domestic and short-haul international flights.
The job cuts affect about one-third of the Brisbane-based airline's workforce across cabin crew, ground crew, engineers, baggage handlers and some international head office staff.
The airline will also suspend all long-haul international flights and transition to a single Boeing 737 fleet for domestic and short-haul international travel, which means it will ditch its ATR, Boeing 777, Airbus A330 and A320 aircraft.
