We present a numerical study on the thermal activated avalanche dynamics in granular materials composed of ferromagnetic clusters embedded in a non-magnetic matrix. A microscopic dynamical simulation based on the reaction-diffusion process is developed to model the magnetization process of such systems. The large-scale simulations presented here explicitly demonstrate inter-granular collective behavior induced by thermal activation of spin tunneling. In particular, we observe an intriguing criticality controlled by the rate of energy dissipation. We show that thermal activated avalanches can be understood in the framework of continuum percolation and the emergent dissipation induced criticality is in the universality class of 3D percolation transition. Implications of these results to the phase-separated states of colossal magnetoresistance materials and other artificial granular magnetic systems are also discussed.