He was 79 and is survived by son Ranbir Singh Mahendra, a minister in Haryana. His elder son Surendra Singh died in a helicopter crash last year which also claimed the life of industrialist Om Prakash Jindal.
Lal was admitted to the AIIMS yesterday after some breathing problem and his end came at around 2345 hours. The cremation will take place at his ancestral village in Bhiwani tomorrow.
A close associate of Indira Gandhi and Sanjay Gandhi during the Emergency when he was the Defence Minister, Lal is considered the architect of modern Haryana, particularly its progress in agriculture and industry.
Lal was the chief minister of the state for four times, the first being in 1968 and the last from 1996 to 1999.
Lal parted his ways with Congress in 1996 and set up Haryana Vikas Party which stormed to power in the Assembly elections held the same year on the plank of prohibition.
He returned to Congress just before the Lok Sabha polls in 2004, which helped the party in its bid to oust Indian National Lok Dal, led by Om Prakash Chautala, from power in last year's Assembly elections.
Bansi Lal was part of the famous Lal trio of Haryana that also included 'Tau' Devi Lal and Bhajan Lal.
Haryana Government declared a holiday tomorrow and three-day mourning as a mark of respect to Bansi Lal.
Bansi Lal was sworn in as Chief Minister for the first time on May 22, 1968 and remained in that post till November 30, 1975.
His second stint at the helm of affairs in the state was from 1972 to 1975 followed by another two from July 5, 1985 to June 19, 1987 and from May 11, 1996 to July 23, 1999.
Haryana Governor A R Kidwai and Chief Minister Bhupinder Singh Hooda condoled Lal's death describing him as "the architect of Haryana", an official spokesman said.