Born in Tullamore, County Offaly, in 1947, Lunny moved to Newbridge, County Kildare as a child and met fellow future Planxty member Christy Moore in 1959. With Moore, Liam O'Flynn and Andy Irvine, Lunny founded Planxty in the early 1970s, redefining Irish music with bouzouki, guitar, keyboards and bodhrán. The group recorded three albums between 1971 and 1973.
In 1973 he established Mulligan Records, going on to produce 17 albums for artists including the Boomtown Rats, The Radiators and Agnes Bernell. He joined The Bothy Band in 1975, pushing boundaries alongside Matt Molloy, Tríona Ní Dhomhnaill, Kevin Burke and others.
Lunny's influence extended beyond performance. In 1981 he and Bill Whelan composed the Eurovision interval act "Timedance"; Whelan later built on that foundation to create the Riverdance interval act in 1994, and the production became a global phenomenon. Lunny produced and served as musical director of the acclaimed TV series "Bringing It All Back Home" and composed film scores including "This Is My Father".
He received a lifetime achievement award at the BBC Radio 2 Folk Awards in 2018 and at the RTÉ Radio 1 Irish Folk Awards last year. One of his final public appearances was at the Fleadh Cheoil na hÉireann in Belfast in August.
Musician and collaborator Neil Martin described Lunny as an "extraordinary figure" and said the loss was "huge". "Since the mid-60s nearly anything that was of significant movement within the traditional music world, Dónal was at the epicentral to it," he told BBC's Evening Extra programme.
The Irish Traditional Music Archive (ITMA) said Lunny's influence was "immense" and that he "opened new harmonic and rhythmic possibilities". "Dónal leaves behind an extraordinary body of work. His artistry, generosity and influence are woven deeply into the living tradition," the archive said.