"The 25-year-old rider collided with a Chilean police car that was traveling in the opposite direction," the Dakar Rally said in a statement.
"The exact circumstances of the accident are being subjected to an inquiry."
Friday's accident comes on the heels of two deaths this week in southern Peru, after an accident involving two taxis and a support truck working for a Dakar team.
This is the fifth year in a row that the Dakar, a gruelling event that started out as a race from Paris across the Sahara desert to the Senegalese capital Dakar, has been held in South America.
The rally started in Lima on Jan. 5 and is scheduled to end in Santiago on January 20.