She was diabetic and had complained of breathing problem last month, following which she was admitted to Mumbai's Guru Nanak Hospital.
Khan passed away on Friday at age 71.
She reportedly changed her name to Saroj to avoid the censure of conservative relatives who did not approve of her career choice. She only believed in work, and wanted to be on the sets till her last years.
She is survived by her husband and three children.
In the 1950s, she became a back-up dancer, appearing in films like Bimal Roy's Madhumati, where she was choreographed by dance director B Sohanlal, whom she later married.
Khan was also known for her work on the films Lamhe, Mr. India and Chandni, notably choreographing routines to more than 2,000 songs over the course of her career.
Distinguished for being more mellow than her signature choreography style but peppered with zingy moves that had Aishwarya Rai Bachchan acing it as a village belle high on life, Barso re, scored by A.R. Rahman and sung by Shreya Ghoshal, is as much an enjoyable watch as it is pleasing to the ears.
Madhuri said that she felt devastated by the loss of her dear friend and teacher. "I was fortunate enough to work with her in many films and got to learn a lot from her". The world has lost an amazingly talented person.
"When she danced it was like watching a whole book!" "She would say "ladki kya kar rahi hai". She made dance look easy nearly like anybody can dance, a huge loss for the industry. She won India's National Film Award for choreography three times: for "Devdas", "Sringaram", and "Jab We Met". "To enjoy dancing, to smile and to smile through the eyes", wrote Kareena. I had to make sure that the "todas" I gave each of them were balanced. "'Master ji, will we be able to do it?' They have that sentence". I believe Indian songs won't be the same anymore, her Kathak with Mahuri Dixit, the fun and romantic songs with Sridevi and Juhi Chawla, that era is gone.
She was also a popular presence on television, hosting an instructional dance show called "Nachle Ve" ("Dance") from 2008 to 2011. She was the greatest influence in my life. Saroj Khan had taken her last breath at 1:52 am in Mumbai.