Fill in the blank with the most appropriate word.
Princess Diana_____in 1997.

In the sentence, "Princess Diana died in 1997," the past tense form of the verb "die" is used. This verb form is appropriate for describing an action that happened and was completed in the past.

The correct form for the sentence is "Princess Diana died in 1997."

The other options are not suitable because they do not use the correct verb form or tense:

Option A: Die
This option uses the base form of the verb "die," which is not correct in the past tense context of the sentence.

Option C: Dies
This option uses the present tense form of the verb "die," which is not appropriate for describing an action that happened in the past.

Option D: Dye
This option uses a different word that is not related to the context of Princess Diana's passing.

Therefore, the correct answer is Option B: Died.