AMERICAN rock legend Lou Reed has died at the age of 71.

The punk-poet of rock n' roll profoundly influenced generations of musicians as leader of the 1960s cult band Velvet Underground and remained a vital solo performer for decades after.

Reed's literary agent Andrew Wylie said the legendary musician died on Sunday morning of an ailment related to his recent liver transplant.

Reed never approached the commercial success of such contemporaries as The Beatles and Bob Dylan, but few songwriters to emerge after Dylan so radically expanded the territory of rock lyrics.

The Velvet Underground became one of the most influential in rock by fusing art and music in collaboration with artist Andy Warhol in 1960s New York.

Online tributes were pouring in on social media after a message sent earlier in the day on Reed's Twitter and Facebook pages read simply "The Door."

The Velvet Underground never achieved much commercial success, but revolutionized rock in the 1960s and 70s with a mixture of thrashing guitar licks and smooth melodies sung by Reed or the sultry German model Nico, who briefly collaborated with the band at Warhol's insistence.

The band has long been recognized as a major musical influence on punk and art rock, as reflected in a quote often attributed to musician Brian Eno which said: "The first Velvet Underground album only sold 10,000 copies, but everyone who bought it formed a band."

An admitted hard drinker and drug user for many years, Reed underwent a liver transplant earlier this year at the Cleveland Mayo Clinic, his wife, Laurie Anderson, revealed after he had cancelled five California concert dates in April.

"I am a triumph of modern medicine," Reed posted on his website on June 1, without directly acknowledging the transplant.

"I look forward to being on stage performing, and writing more songs to connect with your hearts and spirits and the universe well into the future."