Houllier, who underwent a major heart operation when manager of Liverpool, was admitted to hospital in Birmingham on Wednesday evening.
But the 63-year-old will need only "medicine and rest" to recover according to McAllister, who will take charge of the team against Stoke.
McAllister, who was a player at Liverpool when Houllier underwent surgery in 2001, said: "I visited Gerard yesterday (Thursday) in hospital after training and was surprised how well he looked.
"It was really surprising. If you took away all the stuff attached to his arms, he didn't look ill.
"He is on the coronary ward. He was great and bubbly. He had a tough night but he was looking surprisingly well and in fine fettle."
Source: PA
Source: PA