Sherchan, 86, was making an attempt to scale the Mt. Everest in a bid to reclaim the honour of being the oldest man to climb the world's tallest peak.
Mountaineering official Gyanendra Shrestha, who is at the base camp, said the cause was likely cardiac arrest but he could not elaborate due to a poor telephone connection.
In 2008, Min Bajadur Sherchan set the record as a 76-year-old, but it was broken by Japan's Yuichiro Miura in 2013, aged 80.
Shivraj Thapa, managing director of the Summit Nepal Trekking, told Xinhua Saturday that Sherchan died at the base camp at 5:14 p.m. local time.
According to his expedition handler, Sherchan had not suffered any kind of problem throughout his journey to the 5,380 metres base camp.More news: KC(M) wrests dist panchayat prez post from Cong with CPI-M
Prior to his fateful attempt, Sherchan insisted he wasn't trying to outdo Miura.
Earlier this year, before returning to Everest, Sherchan spoke to AFP and said he just wanted to prove to himself that he could still make it to the top of the world.
"My aim is not to break anybody's record, this is not a personal competition between individuals".
Mr Sherchan is survived by his 74-year-old wife, five daughters, two sons and 17 grandchildren.
Nepal has cleared 371 mountaineers to climb Mount Everest during the current season ending this month.More news: Joey Logano, Penske penalized following victory at Richmond
Almost 750 people are expected to try and climb Everest during the small window of opportunity afforded by the weather.
This year is especially crowded because it is the last chance for climbers who were forced away by a devastating quake in 2015.
Officials of the Nepali Department of Tourism which issues climbing permits has not confirmed his death so far.
The large number of climbers has raised fears of risky traffic jams on the 8848 meter (29,029 foot) slope.
World famous mountaineer Ueli Steck, known as the Swiss Machine was killed Sunday after falling to his death near Everest.More news: 'Clean Air Zone': Nottingham could impose camera-contolled charges for polluting vehicles