Mr Koirala was a prominent politician for decades
The former Nepalese Prime Minister Girija Prasad Koirala has died in Kathmandu, his aides and state TV say.
Mr Koirala, 86, served four terms as PM with the Nepali Congress Party and led protests that brought down King Gyanendra's authoritarian rule.
Thousands of supporters had gathered outside his daughter's house where he was taken after being in hospital for several days.
Mr Koirala's political career spanned seven decades.
He first came to prominence as a union leader in the late 1940s, and he was imprisoned, exiled or detained on numerous occasions for championing the cause of democracy against various autocratic regimes.
In 1960, he was jailed for eight years for his pro-democracy views.
G P Koirala, as he was popularly known, first became prime minister in the country's first democratic elections in 1991.
His government lasted three years, and collapsed after a no-confidence vote.
He played a key role in public demonstrations in the early 1990s to end the absolute powers of the king.
In 2000 he returned as prime minister, heading the ninth government in 10 years.
It was during that term that in 2001, King Birendra was murdered by his son - along with nine members of his family.
By July 2001 Maoist rebels had stepped up a campaign of violence, prompting Prime Minister Koirala to quit over the violence.
Five years later he was appointed prime minister by King Gyanendra who reinstated parliament following weeks of violent strikes and protests against direct royal rule.
He was too sick to attend rallies celebrating the resumption of parliament, having suffered from respiratory problems for years.
In May 2006 Parliament voted unanimously to curtail the king's political powers.
The same month, the government and Maoist rebels began peace talks, the first in nearly three years, resulting in a peace accord by November 2006.
The Comprehensive Peace Agreement (CPA) declared a formal end to a 10-year rebel insurgency.
Mr Koirala was also acting head of state in 2008 before the election of Nepal's first president.
Mr Koirala's body will lie in state at the national stadium on Sunday, with his funeral later in the day at the Pashupatinath Hindu temple in Kathmandu, his aide Gokarna Poudel said, according to AFP news agency.
Indian Prime Minister Manmohan Singh expressed condolences.
"Koirala spent his entire political life championing the cause of the people..." Mr Singh said.
"Koirala was a mass leader and a statesman, whose knowledge and wisdom guided the polity of Nepal in the right direction at critical junctures in the country's history."