The 59-year-old victim was among the first two cases of the deadly Middle East Respiratory Syndrome virus to be discovered in Algeria late last month.
Both men had just returned from a pilgrimage to Muslim holy sites in Saudi Arabia, where most cases and deaths from the disease have been reported.
The unnamed man died after 11 days in hospital in the town of Tlemcen, 600 kilometres west of Algiers, following a deterioration of his vital functions overnight Monday.
The condition of the second confirmed MERS case, a 66-year-old man hospitalised in Kolea near Algiers, is improving, the health ministry said.
Other countries, including Egypt, Jordan, Lebanon, Iran, the Netherlands, the United Arab Emirates and the United States, have also recorded cases, mostly in people who had been to Saudi Arabia.
The MERS virus is considered a deadlier but less transmissible cousin of the Severe Acute Respiratory Syndrome (SARS) virus that appeared in Asia in 2003 and killed hundreds of people, mostly in China.
Like SARS, it appears to cause a lung infection, with patients suffering coughing, breathing difficulties and a temperature. But MERS differs in that it also causes rapid kidney failure.
MERS has killed 284 people in Saudi Arabia since it first emerged in 2012, and hundreds more have been infected.
Muslim pilgrims from around the world are pouring into the holy city of Mecca in Saudi Arabia, undeterred by the spread of the deadly virus.
Research has suggested that the virus has been quite common in camels for at least the past 20 years.
Last week, researchers said they had found the first direct evidence that MERS jumps directly from camels to humans.