Dhasal, who was battling with colorectal cancer, was 64.
His last rites will be performed on Thursday.
Dhasal was one of the founders of the militant Dalit Panther movement which started after the riots in Mumbai’s BDD chawls in the late 1960s.
He was also a pioneer of the Dalit literature movement.
In 2007, actors Amitabh Bachchan and Salman Khan had helped raise funds for Dhasal, whose family was on the verge of selling their house to pay his medical bills.
Dhasal, a rights activist, received the Nehru award for his book Golpitha. In 2004, he was awarded the prestigious Sahitya Akadami award for his contribution towards enriching Indian literature.
Dhasal's selected poems were translated into English under the title Namdeo Dhasal: Poet of the Underworld, Poems 1972-2006.
Bollywood's star siblings, coming soon to a theatre near you!
How Delhi, Mumbai airports turned into money spinners
Kalki: My problems with Anurag have nothing to do with Huma
PIX: Sophie Choudry, Sunidhi Chauhan at singer Toshi's wedding reception
Salman, Kapil Sharma: Television's Top Anchors, 2013