Valu Haridhas was among four Indians injured when a group of rioters hurled 40 Molotov cocktails into their Nuwaidrat accommodation.
The 30-year-old suffered from third degree burns while the others Prem Sagar, 43, Bhek Singh, 48, and Narsaiah, 40, were treated for first degree burns at Salmaniya Medical Complex (SMC).
Indian Embassy officials confirmed the death yesterday and will contact Mr Haridhas's employer to complete formalities to repatriate the body.
A spokesman confirmed all four workers were illegal.
"They were all illegal workers and were living in a labour accommodation in Nuwaidrat," said the spokesman.
"Mr Haridhas was treated the Intensive Care Unit while the other three ran away from the hospital following the treatment.
"We are now trying to track down the sponsor to complete formalities to repatriate his body.
"We are facing difficulties in completing formalities as he was an illegal worker."
The spokesman urged Indians living illegally in Bahrain to leave the country and return through the proper channels.
"The workers, who stay in Bahrain illegally, must understand the consequences they would face if they don't change their status from illegal to legal," he explained. "And it is difficult for us to follow such cases, as we are helpless to follow with authorities and employers."