He died on Tuesday surrounded by family, the Sydney Morning Herald reported.
The Newcastle-born painter's career spanned more than 60 years, with his work exhibited in galleries across the nation and overseas, and he was a winner of the Archibald, Wynne and Sulman prizes.
Among his acclaimed works is Salute to Five Bells, which hangs in the Sydney Opera House. A tribute to his long career will be beamed onto the building's sails next month during the Vivid Sydney festival.
Olsen spoke to AAP in 2022 about his affinity with rural and remote Australia, having long captured its wild terrain.
"To be an Australian landscape painter is to be an explorer," he said after donating several of his works to a regional NSW gallery.
"There is so much to look at and observe about the Australian landscape, how it varies from tropical to the coastal fringe, and the interior.
"It's so multiple. It's a beautiful animal, that landscape."
After receiving an Order of Australia in 2001, Olsen described art as a form of compulsion, which he started developing at age four.
"Artists are born, not made," he said.
Olsen received numerous other awards in his long career, including an OBE in 1977.
He won the Archibald for Self portrait Janus Faced in 2005, the Wynne Prize for The Chasing Bird Landscape in 1969 and A Road to Clarendon: Autumn in 1985, and the Sulman Prize for Don Quixote Enters the Inn in 1989.
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