The 30-share barometer fell by 71.11 points, or 0.35 per cent, to 20,051.21. The index had gained 183.28 points in the previous two sessions.
Stocks of FMCG, capital goods, metal, auto, IT and realty sectors declined due to profit-booking.
Similarly, the wide-based National Stock Exchange index Nifty fell by 25.40 points, or 0.42 per cent, to 6,081.85.
Brokers said selling by funds amid mixed trend on other Asian bourses mainly influenced the trading sentiment.
Asian shares eased today with sentiment hit by selling in commodities triggered by a strong dollar, which rose to a fresh four-and-a-half-year peak against the yen on the back of growing confidence in the US economy.
Japan's Nikkei Index was up 1.63 per cent, while Hong Kong's Hang Seng index shed 0.82 per cent in early trade.