On May 13, 2006, he received an honorary doctorate in education from Missouri Western State University where he also gave the commencement speech.
O'Neil was a member of the 18-member Baseball Hall of Fame Veterans Committee from 1981 to 2000 and played an important role in the induction of six Negro league players from 1995 to 2001 during the time the Hall had a policy of inducting one Negro leaguer per year. O'Neil was nominated to a special Hall ballot for Negro league players, managers, and executives in 2006, but received fewer than the necessary nine votes (out of twelve) to gain admission; however, 17 other Negro league figures were selected.
On July 29, 2006, O'Neil spoke at the induction ceremony for the Negro league players at the Baseball Hall of Fame.
The Kansas City T-Bones retired his number on May 26, 2006.
On August 5, 2006, O'Neil was admitted to a Kansas City hospital after complaining that he did not feel well. He was admitted for fatigue and was released three days later only to be re-admitted on September 17. On September 28, Kansas City media reported O'Neil's condition had worsened. On October 6, O'Neil died at the age of 94 due to heart failure and bone marrow cancer.
On December 7, 2006, O'Neil was posthumously awarded the Presidential Medal of Freedom by President George W. Bush; the award was presented to his brother, Warren, on his behalf on December 15. He was chosen due to his "excellence and determination both on and off the baseball field", according to the White House news release. He joins other baseball notables such as Roberto Clemente, Joe DiMaggio, Willie Mays, and Jackie Robinson in receiving the United States' highest civilian honor. On November 13, 2012 the family of Buck O'Neil donated his Presidential Medal of Freedom to the Negro Leagues Baseball Museum in honor of what would have been O'Neil's 101st birthday. The medal will be showcased in a special area of the NLBM dedicated to O'Neil.