Temperature dependent single-crystal x-ray diffraction (XRD) in transmission mode probing the bulk of the newly discovered K0.8Fe1.6Se2 superconductor (Tc = 31.8 K) using synchrotron radiation is reported. A clear evidence of intrinsic phase separation at 520 K between two competing phases, (i) a first majority magnetic phase with a ThCr2Si2-type tetragonal lattice modulated by the iron vacancy ordering and (ii) a minority non-magnetic phase having an in-plane compressed lattice volume and a weak superstructure, is reported. The XRD peaks due to the Fe vacancy ordering in the majority phase disappear by increasing the temperature at 580 K, well above phase separation temperature confirming the order-disorder phase transition. The intrinsic phase separation at 520K between a competing first magnetic phase and a second non-magnetic phase in the normal phase both having lattice superstructures (that imply different Fermi surface topology reconstruction and charge density) is assigned to a lattice-electronic instability of the K0.8Fe1.6Se2 system typical of a system tuned at a Lifshitz critical point of an electronic topological transition that gives a multi-gaps superconductor tuned a shape resonance.