Egypt's health ministry said on Saturday that Amal Mohammed Ismail, 30, from Qaloubiyah province, about 40km north of Cairo, was taken ill on Wednesday.
"They (doctors) took samples for analysis at the ministry of health laboratories... They confirmed she was infected with bird flu. She died on Friday morning," a health ministry statement said, adding the woman had been given Tamiflu, a drug used to treat suspected cases of bird flu.
The World Health Organisation (WHO) confirmed that Egypt had reported its first human case of bird flu.
Dr Hassan al-Bushra, WHO's regional adviser for communicable diseases surveillance, said the H5N1 strain of bird flu had been found in a blood sample taken from the woman, and that other samples were being tested for confirmation.
The woman had earlier reported the death of chickens she raised at her home, al-Bushra said, adding that initial reports seemed to indicate that she had then killed other chickens herself for consumption.
She was later admitted to hospital with a fever and shortness of breath.
The highly pathogenic H5N1 strain has been found in birds in 18 of Egypt's 26 governorates.
Telephone hotlines set up after the disease was initially discovered last month in Egypt, the world's most populous Arab state, were jammed by worried Egyptians after farmers reportedly threw slaughtered poultry onto the streets and into the Nile river.
Egyptian farmers say the poultry market - worth about 17 billion Egyptian pounds ($3 billion) and supporting up to 3 million people - has been devastated.
No Israeli cases
In Israel, authorities were working on Saturday to contain its first outbreak of the disease. They were relieved to be told that four farm workers admitted to hospital on Friday had not contracted the virus.
A ban on all exports of poultry products remained in force as agriculture ministry vets began culling hundreds of thousands of chickens and turkeys in four infected farms across southern and central Israel.
Quarantine orders sealed off the four communities in the southern farming belt east of the Gaza Strip, and between Jerusalem and the commercial capital of Tel Aviv.
The four farm workers, one of them a Thai migrant, had been placed in hospital isolation units as a precautionary measure on Friday after tests on dead fowl confirmed the H5N1 strain.
The Palestinian health ministry announced on Saturday that the West Bank and Gaza Strip were free of the virus.
Elsewhere in the region, birds have been reported infected with the H5N1 strain of avian influenza in Iran and Kuwait. A less potent form of the virus was detected in Saudi Arabia.
The H5N1 strain of bird flu has killed nearly 100 people worldwide, according to the WHO, and caused millions of birds to be killed.