The family friend, who was not named, said the former president was "in a coma" in a hospital in Jeddah, according to a BBC News reoprt.
"He had a stroke, and his condition is serious," he said. The news was also confirmed by Tunisia's Le Quotidien newspaper on Thursday.
The former Tunisian president has traveled to Saudi Arabia with his family after weeks of mass protests over widespread unemployment, human rights violations and other social issues.
Dissident and journalist Touafik Ben Brik, who was jailed under the regime for articles criticising Ben Ali, told AFP he felt as if he was "almost in mourning" for the dictator, such was his hold on the country, Aljazeera News
"I can never forget. He is still in us, he is part of our past and he will live for a long time in us."
Yadh Ben Achour, a Tunisian lawyer and head of the newly established national commission for political reform, said Ben Ali's hospitalisation in exile "is proof there is justice on earth".
The 74-year old former president has been staying in Saudi Arabia since January 14.
Tunisia's mass uprising has triggered similar protests and demonstrations in neighboring countries in the the middle east leading to the ouster of Egyptian president Hosni Mubarak over a week ago.
Mass protests and demonstrations are on-going in Yemen, Libya, Iran and Bahrain while similar mass actions have been reported in Algeria.