Check the oil level in the reservior -- if you are seriously low, the rear end can sag.
Otherwise, the usual reasons are a broken or disconnected level control valve (connects to the sway bar) or dead struts. The accumulators can go, too, but they give a seriously hard ride at normal height, not sag.
The level control pump can be bad, too.
There are several threads dealing with this subject.
1972 220D ?? miles
1988 300E 200,012
1987 300D Turbo killed 9/25/07, 275,000 miles
1985 Volvo 740 GLE Turobodiesel 218,000
1972 280 SE 4.5 165, 000 - It runs!