The leaders of Tanzania and Zanzibar were among hundreds of people to pay their respects as singer Fatma binti Baraka, known as Bi Kidude, was buried.
The BBC's Tulanana Bohela says lots of people were crying, as many Zanzibari women thought of her as their mother or grandmother.
Our reporter says many people wanted to confirm the news of her death.
Thought to be more than 100 years old, she performed the Swahili, Arab-influenced Taarab music.
She continued performing and touring until recently.
In 2005, she was awarded a prize for her contribution to world music at Womex, the annual gathering of the world music industry.
Hundreds of women mourned at her house in Zanzibar town, before her body was taken to the mosque for final prayers.
She was then buried in her village of Kitumba, where Tanzanian President Jakaya Kikwete paid his respects.
Correspondents say Bi Kidude's performances were known for their intense energy; she often beat a large drum and danced on stage as she sang.
She also broke Muslim taboos by openly smoking and drinking alcohol, they say.
According to Womex, she started her career as a Taraab singer in the 1920s.
The singer's exact date of birth is not known, but she is believed to have been born in 1910.