Dupuy ‘s special forces unit had engaged in “particularly violent” clashes with a group of about 30 armed Islamists in the Adrar des Ifoghas mountains near the Algerian border, French defence ministry said on Wednesday.
President François Hollande expressed his “profound respect for the sacrifice of this special forces officer”.
Dupuy previously served in Afghanistan and was part of a parachute commando unit in Mali.
Former defence minister and opposition MP Hervé Morin told RFI on Thursday that he fears an "Afghanisation" of the situation in Mali.
Jihadist groups flee over the border when they are attacked and "come back as we hand over to other forces", he said.
The last French soldier to lose his life in Mali was killed by a suicide attacker on 14 July just before the announcement of the end of the Serval operation to defeat Islamist and Tuareg separatist rebels in the north of the country.
Defence Minister Jean-Yves Le Drian this week announced that troops who had been transferred to operation Barkhane, which replaced Seval and is spread over five countries of the Sahel, would return to Mali to counter a rise in activity by Al-Qaeda in the Islamic Maghreb (Aqim) and similar groups.