At stumps, Parvinder Singh was batting on 13 and Amir Khan was batting on 11 at the Vidarbha Cricket Association Ground.
Dagar hit 14 fours during his 258-ball knock after his team elected to bat.
Mohammad Kaif scored 85 from 212 balls, hitting seven fours and three sixes.
Uttar Pradesh's innings was built largely on the back of the 199-run partnership for the second wicket between Dagar and Kaif.
It was the duo's stand, after the early loss of Tanmay Srivastav, that Uttar Pradesh clawed back into the match.
The visitors, however, lost the momentum a bit after losing three wickets in the final session.
For the hosts, Sandeep Singh picked up three wickets 56, while there was one for Shrikant Wagh who dismissed the centurion.
Uttar Pradesh 1st innings: 248 for four in 90 overs (Dagar 116, Kaif 85; Sandeep 3/56).