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The Prime Minister's father died shortly after David Cameron reached his hospital bedside, Downing Street has said.
Mr Cameron had flown to France after the 78-year-old suffered a stroke and heart complications while on holiday.
"It is with deep regret we can confirm that Ian Cameron died earlier this afternoon," Downing Street said in a statement.
"He passed away shortly after the Prime Minister arrived at the hospital in France where he was undergoing treatment."
Mr Cameron received a call early in the morning from his mother and missed Prime Minister's Questions in order to be with his father.
"After talking to doctors at the hospital, the Prime Minister has decided to fly to be with his father and mother Mary," Downing Street said just after 10am.
Mr Cameron and his siblings, Alex and Clare, flew on a commercial flight from London's City airport.
A helicopter laid on by President Sarkozy took the family from Nice to Toulon. The French authorities are also helping sort out accomodation.
Deputy Prime Minister Nick Clegg stood in for Mr Cameron in the Commons and Labour also fielded a deputy, with Jack Straw replacing interim leader Harriet Harman.
Mr Straw said the Prime Minister had made "exactly the right decision" to be with his parents.
Before news of the death had been announced, former Prime Minister Tony Blair said on ITV1's This Morning: "I send all my sympathy to David and to his family."
Mr Cameron's parents joined him on the campaign trail in Swindon in April and he credited them for inspiring his "Big Society" idea.
The Prime Minister, who arrived in France at lunchtime, recently described his father as a "huge hero figure".
"He's an amazingly brave man because he was born with no heels - quite a disability," he told ITV earlier this year.
"But the glass with him was half-full, normally with something alcoholic. I think I got my sense of optimism from him."
His father enjoyed a successful career as a stockbroker before he retired.
Mr Cameron's loss comes weeks after his fourth child, Florence Rose Endellion, was born during a family holiday in Cornwall.
It is not believed the PM's father met his youngest grandchild before his death.
Source: Sky News
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