First of all I do not agree that "Reality is an illusion" is the general sense of the widespread saying. The general sense is: “The reality is beyond all illusions”. It means if you find the Truth or truth finds you; you go beyond all illusions. It also means that ‘reality’ as it is perceived generally is an illusion.
Hinduism has a special word for this illusion. They call it ‘Maya’. Maya is the measurement against the standard unit ‘self’. To make it clear: Suppose you have a meter scale and you are using it to measure the length of some object. Let us assume that you use this meter scale to measure the length of your stick and you come up to the conclusion that your stick is three meters in length. Now what if the scale used had some error in it? What if your scale was inaccurate? What if your scale shows every length by adding a (.25) of a meter to it? Just because the standard used to measure the length is not accurate, anything which will be measured against this standard will not be accurate.
Similarly, our perceptions, our reality, our universes are, measurements against the standard of our ‘selves’. My universe is the measurement against my own ‘self’. How and why so?
It is so because, every- thing in my universe is projection of my own mind. If my mind suspends then my universe no more exists. My thoughts are my universe. My thoughts make my reality. Each and every thought of mine emanates from the primordial thought of me/mine. What if my knowledge of my own ‘self’ is not accurate? What if my knowledge of ‘self’ is not correct?
If I do not know about myself and everything else I know is dependent on my knowledge of myself, then, everything I know, must be, an illusion, it must be in-accurate. It will be inaccurate if my knowledge of self is inaccurate -but if my knowledge of self is illusory, and lies in, some other order of reality, then, my knowledge of everything is illusory. This is why everything is Maya as per Mayavadins. Everything known is known because of the knowledge of the ‘self’ and the knowledge of the ‘self’ is in itself an illusion; therefore, everything known is illusion. Everything known is a projection of mind; as real, as the mind.