The prime minister and vice president of the United Arab Emirates, Sheikh Maktoum bin Rashid al-Maktoum, died early today in Australia, the official WAM news agency said.
Diplomats said Sheikh Maktoum, who is also the ruler of Dubai, suffered heart problems and was in his mid-60s.
Sheikh Mohammed bin Rashid al-Maktoum, who is the UAE's defence minister, is Maktoum's brother and heir who will automatically take over as ruler of Dubai.
Officials said UAE President Sheikh Khalifa bin Zayed al-Nahayan will appoint a new premier and vice president for the Gulf Arab state that is a federation of seven emirates.
Sheikh Maktoum maintained a low profile, preferring to allow his younger brothers, including the globally renowned entrepreneur Sheikh Mohammed, to run the day-to-day affairs of Dubai, the Gulf region's trade and tourism hub.
Sheikh Maktoum is best known as co-owner of Dubai's Godolphin stables which competes in major horse races.
"The UAE has today lost a historical leader who dedicated his life to building the nation and doing good for its people," said a statement from the UAE's presidency.
Dubai's main stock market halted trading after the news. The UAE has declared 40 days of mourning and government institutions will be closed for a week.