Mukhti died on Friday night following a raid on her house in Ahlaan village in Kokernag area, 80 km from here, during an anti-narcotics drive.
Villagers alleged that the woman was beaten up by policemen resulting in her death, but police claimed that she had died of a massive cardiac arrest.
Locals held protests on Saturday, demanding arrest of the accused policemen.
The body was sent for postmortem and further action will be taken on the basis of the report, the police official said. Police had conducted a raid on Mukhti's house following a tip-off about the presence of large quantity of 'dioscerea', herb grown in the wild in south Kashmir but banned by government as it is used in making drugs.
The locals alleged that the son-in-law of the deceased had given false information to police to settle personal scores with the bereaved family.