The Japanese Ministry of Health said the man was the sixth person from ship, which has been quarantined off the country's coast, to have died.
He is the first Briton to have died from coronavirus, also known as Covid-19.
In the UK, 19 people have been diagnosed with the illness.
Health Minister Jo Churchill has said she was aware a British man who had been on board the ship was "very poorly".
She told BBC Radio 4's World At One programme: "The Foreign Office are supporting the family of a British man who has been very poorly and was a passenger on board the Diamond Princess.
"I haven't had confirmation because obviously I'm on the telephone to you, but I was aware there was a gentleman who was very, very poorly, and I'm sure like me your thoughts and sympathies go out to his family at this time."
Earlier on Friday, Wales reported its first patient with the virus and two more sufferers were identified in England.
The patient in Wales had recently travelled back from Italy, the worst-affected country in Europe.
Those identified in England had recently travelled back from Iran, the Department for Health said. The virus has spread rapidly across Iran - with 22 dead amid 141 cases confirmed.
So far, China has reported nearly 80,000 cases and almost 3,000 deaths, while the virus has reached nearly 60 countries with more than 80 deaths.