"Labour Minister Dr. Ghazi Al-Gosaibi died on Sunday in King Faisal's Specialist Hospital in Riyadh after a long struggle with illness," Al Arabiya said, adding that he died of cancer.
There was no immediate confirmation from the Saudi government on the death of Al-Gosaibi, 70, who had been undergoing medical treatment abroad.
Al-Gosaibi was a former ambassador to London and a confidant of King Abdullah, whose push for reforms in the world's top oil exporter fostered divisions among senior members of the religious establishment and between reformists and the most conservative clerics.
He was also a writer and poet whose liberal tone provoked the ire of both the official clerical establishment and Al-Qaeda leader Osama Bin Laden, who singled him out in a taped message from his hideout in 2006 as a fifth columnist.
Jamal Khashoggi, political analyst and head of a newly established channel owned by Prince Alwaleed bin Talal said: "He is a man to be missed ... as a modernizer, government official, poet and commentator."
As labor minister since 2005, Al-Gosaibi struggled to lower the unemployment rate in the country of 27 million, which rose to 10.5 percent last year.
He oversaw a scheme to bring more Saudi nationals into the labor market by setting a quota for the number of Saudis that must be hired by private firms in the kingdom, where foreigners vastly outnumber locals in private firms.
Al-Gosaibi also played a key role in setting up the state-controlled Saudi Basic Industries Corp, the kingdom's largest listed firm.
The minister's writings include short stories such as "An apartment called Freedom" and poems such as "A battle with no flag" and "For the martyrs."
"He confronted extremist ideology and background with a bold narrative," said Khaled Almaeena, a political analyst and chief editor of the Arab News daily, describing him as "a man of wit and culture and in many ways ahead of his time."
