Before his death, Ben Ali has been in intensive care unit of an unmentioned hospital for three months after battling prostate cancer for years. He died at the age of 83, days to a free presidential election in his homeland.
"Ben Ali just died in Saudi Arabia," family lawyer Mounir Ben Salha told Reuters news agency by phone.
Tunisia's foreign minister, Khemaies Jhinaoui also confirmed the death of Ben Ali who ruled Tunisia for 23 years and amassed an enormous fortune.
Some claimed that the former Tunisan autocrat who came to power in November 1987 after convincing doctors to declare that the previous president-for-life Habib Bourguiba was senile and unfit to rule, took one-and-a-half tonnes of gold with him to Saudi Arabia, stolen from Tunisia's central bank.
Ben Ali fled Tunisia in January 2011 as his compatriots rose up against his oppressive rule in a revolution that inspired other Arab Spring uprisings abroad and led to a democratic transition at home.