President Susilo Bambang Yudhoyono will oversee the state funeral in a Javanese royal burial ground near Solo.
Suharto ruled with an iron first for 32 years and was accused of endemic corruption and human rights abuses.
More than half a million suspected communists were killed during his rise to power in the 1960s.
He left office in 1998 amid mass protests over corruption and human rights abuses but did not stand trial on health grounds.
Following news of his death, hundreds of people gathered in the streets around his Jakarta house, many with tears in their eyes.
Many Indonesians still fondly call him their Father of Development but his critics say he ruled by instilling fear, the BBC's Rebecca Henschke reports from Jakarta.
'A great leader'
The cemetery is built on land that has been preserved for centuries for Javanese royalty.
Suharto will be laid to rest next to his wife Tien, who was a minor member of the Solo royal family.
The cemetery is perched on a mountain and was built amid controversy in the 1970s by a charitable foundation that Suharto controlled.
Local press are reporting that many Asian leaders, including East Timor President Xanana Gusmao and former Malaysian Prime Minister Mahathir Mohamad are expected to attend.
The ceremony will be a traditional Javanese Islamic funeral.
Hundreds of police and the military elite unit Kopassus have been deployed.
President Yudhoyono called on the nation to thank the former leader for his services to the Indonesian nation.
He asked them to show "the highest respect to one of the nation's best sons, a great leader of the nation who has contributed so much service and dedication to the nation and the state".
The government announced a week of national mourning.
Long illness
Suharto was rushed to hospital on 4 January suffering from various heart, lung and kidney problems.
After suffering multiple organ failure for a second time since his admission, he died at 1310 (0610 GMT) on Sunday after slipping into a coma, doctors said.
All six of his children were at the hospital when he died.
Soldiers and police had to force back crowds of Suharto supporters to allow the ambulance carrying his body to leave the hospital.
The US ambassador to Jakarta, Cameron Hume, hailed Suharto as a "historic figure" who "achieved remarkable economic development", while adding that there "may be some controversy over his legacy".
Mr Mahathir said he had regarded Suharto - "a great leader and... an international statesman" - as a friend of Malaysia and a personal friend.
Japanese Prime Minister Yasuo Fukuda paid tribute to the dead man's work to promote "friendly and goodwill relations" with his country.
But for Indonesian political opponents, his death meant a missed opportunity to put him on trial.
"His death is a tragedy for all the victims of his crimes, they will never get justice," said Budiman Sudjatmiko, who was jailed as a student activist.
"Count in his corruption, then he is a perfect criminal - he can be put up there with Pol Pot and Hitler."
Brad Adams, Asia director of the New York-based NGO Human Rights Watch, said Suharto had "gotten away with murder - another dictator who's lived out his life in luxury and escaped justice".
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