Cave's death at the age of 25 was confirmed by the club with a statement from his family.
It read: "Our Colby was loved dearly by us, his family and friends, the entire hockey community, and many more.
"We thank everyone for their prayers during this difficult time."
Cave had been placed in a medically-induced coma in Toronto on Tuesday, a day after he had been airlifted to hospital.
The player underwent emergency surgery to remove a colloid cyst that was causing pressure on his brain.
Cave's agent, Jason Davidson, confirmed that the player's condition did not appear to be linked to COVID-19 and tributes have flooded in from across the Oilers organisation and the NHL.
League commissioner Gary Bettman said: "The National Hockey League family mourns the heartbreaking passing of Colby Cave, whose life and hockey career, though too short, were inspiringly emblematic of the best of our game.
"Undrafted but undaunted, Colby was relentless in the pursuit of his hockey dream with both the Edmonton Oilers and Boston Bruins organisations.
"An earnest and hardworking player, he was admired by his teammates and coaches. More important, he was a warm and generous person who was well-liked by all those fortunate enough to know him.
"We send our heartfelt condolences to his wife Emily, their families and Colby's countless friends throughout the hockey world."
Cave scored once in 11 appearances with Edmonton in 2019/20. He also had 11 goals and 23 points in 44 games with the Oilers' American Hockey Leagues affiliate team, the Bakersfield Condors, this season.
The forward had previously spent five seasons with the Western Hockey League's Swift Current Broncos, where he served as captain, before his NHL debut with the Boston Bruins and subsequent move to Edmonton.
During his time in the NHL, Cave registered four goals and five assists in 67 NHL games.
His death comes just over two years after another hockey tragedy in the Saskatchewan province, when 16 people were killed following a bus crash involving the Humboldt Broncos junior hockey team in April 2018.
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