The 29-year-old housewife from Tangerang town on the outskirts of Jakarta, died Saturday at a hospital in the city, said Sumardi, a ministry spokesman.
She was first hospitalized on Jan. 28, six days after she developed symptoms, said Sumardi, who uses a single name.
She was then moved to Persahabatan Hospital in eastern Jakarta on Jan. 29, he said.
The woman was reported to have visited her parents, whose neighbors kept chickens, Sumardi said. It was not clear whether the chickens were infected.
"Her death raised the Indonesian death toll to 103 out of 126 cases," Sumardi said.
A 38-year-old woman from Kali Deres, the Jakarta neighborhood closest to Tangerang, has also been confirmed as having been infected with bird flu and was being treated at Persahabatan Hospital, Sumardi said.
Indonesia has recorded human bird flu deaths regularly since the virus began ravaging poultry stocks across Asia in 2003.
Scientists have warned that Indonesia, which has millions of backyard chickens and poor medical facilities, is a potential hot spot for a global bird flu pandemic.