He was released from prison in Scotland in 2009 on compassionate grounds. He was suffering from cancer and was said to have only months to live.
When he returned to the Libyan capital, he received a hero's welcome.
Shortly before being freed, Megrahi dropped his second appeal against his conviction.
His release sparked the fury of many of the relatives of the victims of the Lockerbie disaster.
Died at home
His brother Abdulhakim said on Sunday that Megrahi's health had deteriorated quickly and he died at home in Tripoli.
He told the AFP news agency that Megrahi died at 13:00 local time (11:00 GMT).
He and another Libyan, Al Amin Khalifa Fhimah, were indicted by the Scottish and US courts in November 1991.
Their trial began in May 2000. Ffimah was acquitted of all charges, but Megrahi was found guilty and sentenced to a minimum of 27 years in prison.
He served the first part of his sentence at the maximum-security prison at Barlinnie, in Glasgow, but was transferred in 2005 to Greenock prison.
Last August after the fall of Libyan leader Col Muammar Gaddafi, Megrahi was reported to be "in and out of a coma" at his home in Tripoli.
He had previously claimed he would release new information about the atrocity but little new has emerged.