How to provide default value for a parameter of delegate type in C#?

You can't, basically. Default values for parameters have to be compile-time constants. However, if you're happy to use null as a value meaning "use the default" you could have:

void FooWithDelegateParam(Func<string, string> predicate = null)
{
    predicate = predicate ?? (x => x);
    // Code using predicate
}

Or use an overload, as per Alireza's suggestion, of course.

Each option has different implications:

• The overload solution works with languages which don't support optional parameters (e.g. C# before 4.0)
• The overload solution differentiates between null and "the default". This in itself has pros and cons:
  • If the caller should never provide a null value, the overload version can find bugs where it's accidentally doing so
  • If you don't believe there will be any such bugs, the optional parameter version allows the idea of "the default" to be represented in code - you could pass a "null meaning default" value through multiple layers, letting only the bottom-most layer determine what that default actually means, and do so more simply than having to explicitly call different overloads
• The optional parameter version is simpler to express in an interface...
  • ... with the downside that the default value would still need to be expressed in the implementation. (This is somewhat common to the overload solution, mind you... in both cases, an abstract class implementing the interface could do the defaulting using the template method pattern.)

You can't specify default value like that. Write an overload instead:

void FooWithDelegateParam()
{
    FooWithDelegateParam(s => s);
}

void FooWithDelegateParam(Func<string,string> predicate)
{

}