The distinguished former player and coach, who won the European Cup Winners' Cup with the Blues as well as two European Under-21 championships with England, was aged 82
Sexton played for Luton Town, West Ham, Leyton Orient, Brighton and Crystal Palace before taking over at Stamford Bridge following a short spell in charge of Leyton Orient.
During his spell as Chelsea boss he won the FA Cup in 1970 and the European Cup Winners' Cup the following season.
Sexton would then go on to manage QPR before taking over at Manchester United in 1977. He also took over as coach of the England Under-21 side and won the European Under-21 Championship twice in 1982 and 1984.
Sir Trevor Brooking, the Football Association's director of football development, regards Sexton as one of the finest coaches the country has produced in recent times.
"It is a sad day," he told the Football Association's official website. "Anyone who was ever coached by Dave would be able to tell you what a good man he was, but not only that, what a great coach in particular he was.
"In the last 30-40 years Dave's name was up there with any of the top coaches we have produced in England - the likes of Terry Venables, Don Howe and Ron Greenwood. His coaching was revered."