His funeral brought large parts of Jerusalem to a standstill. Police said some 700,000 people attended, making it the largest funeral in the country's history. A black-clad sea of mourners engulfed the van carrying Yosef's body to the cemetery, preventing it from moving as dozens of security men pushed the crowd back. It took hours for the van to inch toward the cemetery where the body was then taken to the burial site.
Yosef was often called the outstanding rabbinical authority of the century for the community of Sephardic or Mizrahi Jews, those of Middle Eastern ancestry.
Born in Baghdad in 1920, Yosef was four years old when his family moved to Jerusalem. His exceptional abilities and rebellious nature emerged early.
As a student, he chafed under the strict rule of his European rabbinical instructors, writing conflicting opinions based on Sephardic tradition while still a teenager.
His insistence that Sephardic tradition is as valid as the Ashkenazi or European version of Judaism spawned a religious and cultural awakening. Sephardic Jews make up roughly half of Israel's Jewish population but the community was long impoverished and faced discrimination by Ashkenazi Jews who traditionally dominated government and religious institutions.
Yosef came to national prominence when he served as Israel's chief Sephardic rabbi from 1972 to 1983. While he was revered by his followers, his critics charged that he exacerbated tensions between Ashkenazi and Sephardic Israelis.
His ornate outfit, with a gold-trimmed black cape and upswept hat, combined with his ever-present dark glasses and habitually slurred speech, made him an easy target for caricaturists. He would greet visitors, whether they were simple followers or prime ministers, with a playful slap to the face.
Yosef parlayed his religious authority into political power, founding Shas in the early 1980s.
It gathered just four seats in the 120-seat parliament in its first election, in 1984. But at its peak, Shas won 17 seats in 1999, making it the third-largest party. Even after being hit by scandals, it remained a midsize party that delivered a string of prime ministers their parliamentary majority. Shas currently has 11 seats and sits in the opposition.
For three decades, Yosef held the final word over the party's decisions, with its leaders seeking his guidance over matters large and small.
In the process, it won hundreds of millions of dollars in government funding for schools, charities and religious seminaries that became a source of power and patronage, as well as a cause of resentment among the secular public.
The author of dozens of books about Jewish law and practice, Yosef was a master of communicating with the masses. His weekly sermon packed his neighborhood synagogue. Overflow audiences listened outside on loudspeakers to his often earthy remarks. In recent years the sermons were broadcast by satellite on television.
Yosef's influence reached beyond the party, and he was known for fierce statements that offended widely disparate segments of society, including Holocaust survivors, gays, Palestinians and secular Jews.
The rabbi said during a sermon in August 2010 that Palestinian President Mahmoud Abbas should "perish from the world" and described Palestinians as "evil, bitter enemies of Israel." He later apologized, and on Monday, Abbas expressed his condolences over Yosef's death.
In 2007, he said that Israeli soldiers died in battle because they were not religious enough and said the victims of Hurricane Katrina in the U.S. suffered "because they have no God."
Yet Yosef was a voice of moderation, to an extent.
On questions of war and peace, he made his biggest waves by ruling that Israel may give back parts of the West Bank in exchange for peace, invoking the Jewish concept that preserving life is the highest commandment.
The ruling countered decrees by other rabbis, who declared that no Jew had a right to hand over any part of the biblical Land of Israel to a non-Jew for any reason.
But in later years, he appeared to retreat. He called for then-Prime Minister Ariel Sharon to be struck down by illness after Israel's withdrawal from the Gaza Strip in 2005. Sharon suffered a debilitating stroke in January 2006 and remains in a coma. Shas in recent elections aligned itself with parties opposing territorial concessions.
He also helped women whose husbands went missing in action and were presumed killed in the 1973 Mideast war to remarry. Jewish law can make it difficult for a woman to remarry if there are doubts about whether the husband is alive.
In matters of religion, he upheld the Sephardic tendency to blend ancient Jewish customs with modern developments a contrast to the stringency of Ashkenazi ultra-Orthodox Jews. In one of his better-known rulings, he said that religious women may wear slacks.
Earlier this year, Yosef took a swipe at the strict prohibitions often issued by hardline rabbis. "That's not the way of the Torah," he told Channel 10 TV. "The way of the Torah is to search and find ways to solutions, to make it easier for the people of Israel and not make it harder for them."
Batia Siebzehner, an expert on Shas at the Hebrew University in Jerusalem, said Yosef's crossover appeal would make it difficult to replace him. She said Shas supporters were divided between ultra-Orthodox followers and working-class Sephardic Jews attracted to his message of ethnic empowerment.
"Shas is a social movement, a political party and a new interpretation of religion," she said. "Nobody has the capacity to act as a glue between the different groups."
Deri, a protege of Yosef's, will probably continue to play a key role in the party. Yosef's son, Yitzhak, who is now Israel's chief Sephardic rabbi, and Rabbi Shlomo Amar, a former chief rabbi, could also become key players. None, however, have the charisma and gravitas of Yosef.
It is possible that many Shas followers will turn to other parties. Prime Minister Benjamin Netanyahu's Likud Party, as well as other religious parties, are likely destinations.
But it's also possible that a minority will gravitate to left-wing parties offering less capitalistic policies and that could cause an important shift to the left in a country that the last election, in January, showed to be split almost down the middle.
Haim Amsalem, a former Shas lawmaker who left the party after a falling out with other members, said Yosef could never be replaced.
"Shas as we know it is finished," he told Channel 2 TV. "Now Shas has to reinvent itself."
Yosef is survived by 11 children and dozens of grandchildren and great-grandchildren. His wife Margalit died in 1994.
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Ian Deitch and Daniel Estrin contributed to this report.