From the early 1990s, Farmer had a second house in New York and divided his time between Vienna and there. He had regular gigs with Clifford Jordan at the Sweet Basil Jazz Club and, later, with Ran Blake and Jerome Richardson at the Village Vanguard, both in New York. Farmer was awarded the Austrian Gold Medal of Merit in 1994. In the same year, a concert in honor of his achievements was held at the Alice Tully Hall in New York. Farmer also recorded extensively as a leader throughout his later career, including some pieces of classical music with US and European orchestras. Farmer's level of playing even towards the end of his career was noted in a review by Scott Yanow of one of his last recordings, Silk Road, from 1996: "the warm-toned and swinging Farmer is consistently the main star, and at age 68 he proves to still be in his prime". In 1999 Farmer was selected as a National Endowment for the Arts Jazz Master. A few months later, on October 4, Farmer died of a heart attack at home in Manhattan, aged 71.
Farmer first married in the mid-1950s, to a woman from South America. They divorced after about a year, but the marriage produced one son, Arthur Jr, who died in 1994. Farmer's second wife was a distant cousin; this marriage also ended in divorce. He married again, to a Viennese banker named Mechtilde Lawgger, and their son, Georg, was born in the early 1970s. They lived together in a house that they had built in Vienna, and Farmer reported contentment with his lifestyle; notably, in contrast with his homeland, he did not experience racism in Europe. Farmer described himself in 1985 as "an introvert, and kind of reclusive"; a soundproof room in his Austrian house allowed him to practice alone for the four or five hours a day that he desired. His personality was often described by others as mirroring his playing: Leonard Feather, for instance, observed in 1990 that Farmer was "mellow, relaxed and [...] gentle".