The year 1926 saw a sharp and lasting decline in Sibelius's output: after his Seventh Symphony, he only produced a few major works in the rest of his life. Arguably the two most significant were incidental music for Shakespeare's The Tempest and the tone poem Tapiola. For nearly the last thirty years of his life, Sibelius even avoided talking about his music. There is substantial evidence that Sibelius worked on an eighth numbered symphony. He promised the premiere of this symphony to Serge Koussevitzky in 1931 and 1932, and a London performance in 1933 under Basil Cameron was even advertised to the public. However, the only concrete evidence for the symphony's existence on paper is a 1933 bill for a fair copy of the first movement. Sibelius had always been quite self-critical; he remarked to his close friends, "If I cannot write a better symphony than my Seventh, then it shall be my last." Since no manuscript survives, sources consider it likely that Sibelius destroyed all traces of the score, probably in 1945, during which year he certainly consigned (in his wife's presence) a great many papers to the flames.

On January 1, 1939, Sibelius participated in an international radio broadcast which included the composer conducting his Andante Festivo. The performance was preserved on transcription discs and later issued on CD. This is probably the only surviving example of Sibelius interpreting his own music.

His 90th birthday, in 1955, was widely celebrated and both the Philadelphia Orchestra under Eugene Ormandy and the Royal Philharmonic Orchestra under Sir Thomas Beecham gave special performances of his music in Finland. The orchestras and their conductors also met the composer at his home; a series of memorable photographs were taken to commemorate the occasions. Both Columbia Records and EMI released some of the pictures with albums of Sibelius's music. Beecham was honored by the Finnish government for his efforts to promote Sibelius both in the United Kingdom and in the United States.

Tawaststjerna also relayed an endearing anecdote regarding Sibelius's death:

[He] was returning from his customary morning walk. Exhilarated, he told his wife Aino that he had seen a flock of cranes approaching. "There they come, the birds of my youth," he exclaimed. Suddenly, one of the birds broke away from the formation and circled once above Ainola. It then rejoined the flock to continue its journey. Two days afterwards Sibelius died of a brain hemorrhage, at age 91 (on 20 September 1957), in Ainola, where he is buried in the garden. Another well-known Finnish composer, Heino Kaski, died that same day. Aino lived there for the next twelve years until she died on 8 June 1969; she is buried with her husband.

In 1972, Sibelius's surviving daughters sold Ainola to the State of Finland. The Ministry of Education and the Sibelius Society opened it as a museum in 1974.

Like many of his contemporaries, Sibelius was initially enamored with the music of Wagner. A performance of Parsifal at the Bayreuth Festival had a strong effect on him, inspiring him to write to his wife shortly thereafter, "Nothing in the world has made such an impression on me, it moves the very strings of my heart." He studied the scores of Wagner's operas Tannhäuser, Lohengrin, and Die Walküre intently. With this music in mind, Sibelius began work on an opera of his own, entitled Veneen luominen (The Building of the Boat). However, his appreciation for Wagner waned and Sibelius ultimately rejected Wagner's Leitmotif compositional technique, considering it to be too deliberate and calculated. Departing from opera, he later used the musical material from the incomplete Veneen luominen in his Lemminkäinen Suite (1893). He did, however, compose a considerable number of songs for voice and piano, whose early interpreters included Aino Ackté and particularly Ida Ekman.

More lasting influences included Ferruccio Busoni, Anton Bruckner and Tchaikovsky. Hints of Tchaikovsky's music are particularly evident in works such as Sibelius's First Symphony (1899) and his Violin Concerto (1905). Similarities to Bruckner are most strongly felt in the 'unmixed' timbral palette and sombre brass chorales of Sibelius's orchestration, as well as in the latter composer's fondness for pedal points and in the underlying slow pace of his music.

Sibelius progressively stripped away formal markers of sonata form in his work and, instead of contrasting multiple themes, he focused on the idea of continuously evolving cells and fragments culminating in a grand statement. His later works are remarkable for their sense of unbroken development, progressing by means of thematic permutations and derivations. The completeness and organic feel of this synthesis has prompted some to suggest that Sibelius began his works with a finished statement and worked backwards, although analyses showing these predominantly three- and four-note cells and melodic fragments as they are developed and expanded into the larger "themes" effectively prove the opposite.

This self-contained structure stood in stark contrast to the symphonic style of Gustav Mahler, Sibelius's primary rival in symphonic composition. While thematic variation played a major role in the works of both composers, Mahler's style made use of disjunct, abruptly changing and contrasting themes, while Sibelius sought to slowly transform thematic elements. In November 1907 Mahler undertook a conducting tour of Finland, and the two composers had occasion to go on a lengthy walk together. Sibelius later reported that during the walk:

However, the two rivals did find common ground in their music. Like Mahler, Sibelius made frequent use both of folk music and of literature in the composition of his works. The Second Symphony's slow movement was sketched from the motive of Il Commendatore in Don Giovanni, while the stark Fourth Symphony combined work for a planned "Mountain" symphony with a tone poem based on Edgar Allan Poe's "The Raven". Sibelius also wrote several tone poems based on Finnish poetry, beginning with the early En Saga and culminating in the late Tapiola (1926), his last major composition.

Over time, he sought to use new chord patterns, including naked tritones (for example in the Fourth Symphony), and bare melodic structures to build long movements of music, in a manner similar to Joseph Haydn's use of built-in dissonances. Sibelius would often alternate melodic sections with noble brasschords that would swell and fade away, or he would underpin his music with repeating figures which push against the melody and counter-melody.

Sibelius's melodies often feature powerful modal implications: for example much of the Sixth Symphony is in the (modern) Dorian mode. Sibelius studied Renaissance polyphony, as did his contemporary, the Danish composer Carl Nielsen, and Sibelius's music often reflects the influence of this early music. He often varied his movements in a piece by changing the note values of melodies, rather than the conventional change of tempi. He would often draw out one melody over a number of notes, while playing a different melody in shorter rhythm. For example, his Seventh Symphony comprises four movements without pause, where every important theme is in C major or C minor; the variation comes from the time and rhythm. His harmonic language was often restrained, even iconoclastic, compared to many of his contemporaries who were already experimenting with musical Modernism. 

Because of its alleged conservatism, Sibelius's music is sometimes considered insufficiently complex, but he was immediately respected by even his more progressive peers. Later in life he was championed by critic Olin Downes, who wrote a biography, but he was attacked by composer-critic Virgil Thomson.

Sibelius has sometimes been criticized as a reactionary or even incompetent figure in 20th century classical music. In 1938 Theodor Adorno wrote a critical essay about the composer, notoriously charging that

Composer and theorist René Leibowitz went so far as to describe Sibelius as "the worst composer in the world" in the title of a 1955 pamphlet. Despite the innovations of the Second Viennese School, he continued to write in a strictly tonal idiom. However, critics who have sought to re-evaluate Sibelius's music have cited its self-contained internal structure, which distills everything down to a few motivic ideas and then permits the music to grow organically, as evidence of a previously under-appreciated radical bent to his work. The severe nature of Sibelius's orchestration is often noted as representing a "Finnish" character, stripping away the superfluous from music.

Perhaps one reason Sibelius has attracted both the praise and the ire of critics is that in each of his seven symphonies he approached the basic problems of form, tonality, and architecture in unique, individual ways. On the one hand, his symphonic (and tonal) creativity was novel, but others thought that music should be taking a different route. Sibelius's response to criticism was dismissive: "Pay no attention to what critics say. No statue has ever been put up to a critic."

Sibelius has fallen in and out of fashion, but remains one of the most popular 20th century symphonists, with complete cycles of his symphonies continuing to be recorded. In his own time, however, he focused far more on the more profitable chamber music for home use, and occasionally on works for the stage. Eugene Ormandy and, to a lesser extent, his predecessor Leopold Stokowski, were instrumental in bringing Sibelius's music to American audiences by programming his works often, and the former thereby developed a friendly relationship with Sibelius throughout his life.

In 1990, the composer Thea Musgrave was commissioned by the Helsinki Philharmonic Orchestra to write a piece in honour of the 125th anniversary of Sibelius's birth. Song of the Enchanter was premiered on 14 February 1991.

Research by T.L. Jackson of the University of North Texas, in which he investigated the composer's connections to Nazi Germany, led him to conclude that the composer actively supported, and benefited from, National Socialism. Other scholars have said such conclusions, which fail to account for the exclusively German origin of their source material, are simplistic.