Nadirshakh Khachilayev, a former Russian deputy, was gunned down in his car on Monday but his assailants managed to escape.
No-one has yet claimed responsibility for the killing.
A former head of the Union of Russian Muslims, Khachilayev became a celebrity during the first Chechen war (1994-96).
He commanded respect from Chechens and Russians alike when he acted as an intermediary between resistance fighters in Dagestan’s neighbouring republic and Moscow.
However, the Russians turned against him in 1998.
He was stripped of his parliamentary immunity for his participation in the storming of a Dagestani government building.
Unstable Dagestan has seen many
Moscow concluded the flamboyant Khachilayev was too friendly with Chechen Islamists.
This made him a target after Russia sent troops back into Chechnya in October 1999 to put down a renewed independence bid.
Khachilayev was subsequently arrested, along with his elder brother Magomed, before being amnestied shortly afterwards.
He was re-arrested last year in connection with a bomb attack on an army truck in Makhachkala in which seven Russian servicemen were killed.
But he went on hunger strike and was later released.
Dagestan is the troubled republic of Chechnya’s eastern neighbour.
Many Dagestanis sympathise with the plight of the Chechens and have fought alongside them during their struggle against Russia.