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No. Sally has never died.

You may be referring to this:

In the American Sonic the Hedgehog comics Sally fell to her supposed death in issue #47. This started the epic four issue story arc "Endgame". In the final installment of this story (Issue #50) it is revealed that Sally did not die as previously reported. She did, however, sustain serious injuries from her fall and to keep her safe while she healed she was placed in a life support device camouflaged as a coffin. The rumor of her death was spread to deter further attempts on her life while she was still in a coma. At the end of this story Sally is woken by a kiss referencing Sleeping Beauty. It has been reported that the writers of this story had originally intended for Sally to die once and for all, but negative feedback from SEGA and fans caused the writers to rethink their decision before the ending was published.

SEGA did want her to die forever and leaving sonic sad and angry for the rest of his life also, surprisingly she is Sonic's future wife NN96

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