"I received a call from the doctor on duty (at Jinnah Hospital) at 1 am (1:30 IST) informing me that Sarabjit is no more," said Mahmood Shaukat, the head of a medical board that was supervising Sarabjit's treatment.
Another doctor, who was part of the team treating Sarabjit said he died of cardiac arrest, adding that doctors made several unsuccessful attempts to resuscitate him.
Officials of the Indian High Commission in Islamabad said they had been informed by officials of Jinnah Hospital about Sarabjit's death.
Shaukat said authorities were yet to decide on conducting an autopsy on Sarabjit's body. Asked whether the autopsy would be done after getting permission from the government, he said: "At the moment I have no idea."
No decision had been made about handing over the body to Sarabjit's kin or to Indian authorities, he said. "These matters will be worked out according to the directions from the government," he said.
Earlier in the day, official sources in Lahore had said Sarabjit had slipped into a "non-reversible" coma and this could lead to "brain death".
His measurements on the Glasgow Coma Scale, which indicates the levels of consciousness and damage to a person's central nervous system, had dropped to a "critical level", the sources said.