According to family members, Sarma died early this morning. He is survived by his wife and two children.
Born in 1931 in Dibrugarh district, Sarma has written more than 50 plays and books in his career.
He also won a number of awards, including Padma Shri, Sahitya Academi and Assam Valley Literary.
Condoling his death, Assam Chief Minister Sarbananda Sonowal said people of the state will always remember him for his contribution towards the literary world.
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Former Chief Minister Tarun Gogoi said demise of Sarma meant that Assam has lost one true guardian.
Famous theatre group Samahar Natya Gosthee expressed its condolence at the demise Sarma and termed him as "a towering personality in the arena of Assamese theatre".
"It is a big loss to Assamese theatre, and creative field in general. He will be deeply missed by all," the group said in a statement.