He was 82.
Dhiman was not keeping well for the past few days, family sources said.
A former headmaster and popularly known as "guruji", Dhiman was elected to Himachal Pradesh Assembly for the first time from Mewa constituency in 1990 and won from the seat six times in a row in 1993, 1998, 2003, 2007 and 2012.
Known for his simplicity and honesty, Dhiman served as a state minister in Dhumal government from 1998 to 2003 and 2007 to 2012, holding the education portfolio.
Hundreds of people including supporters, political figures social activists, government officials bid a tearful adieu at the village as a massive crowed turned-up to participate in his funeral procession.
Former Chief Minister Prem Kumar Dhumal, once a student of Dhiman, BJYM chief and Hamirpur MP Anurag Thakur, state BJP chief Satpal satti and other party and Congress MLAs attended the funeral.
With his demise, the strength of BJP has been reduced to 27 in the 68-member legislative Assembly.
"Deputy Commissioner of Hamirpur has sent a communication to the Vidhan sabha informing about demise of I D Dhiman, which will now be notified," Assembly Secretary S S Verma said.
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