"It is with great sadness that Mark and Carol Thatcher announced that their mother Baroness Thatcher died peacefully following a stroke this morning," said Thatcher's spokesman Lord Bell.
Thatcher was Britain's first -- and so far only -- female Prime Minister and the longest-serving in the 20th Century.
Although she was elected to three terms, her conservative policies amid recession and her participation in the Falklands War complicate her legacy.
She began her political career as the Member of Parliament for Finchley in 1959, rising to become the Secretary of State for Education and then Conservative Party leader before she got the top job.
Thatcher had several small strokes in 2002 and withdrew from public speaking and other appearances as her health declined.
Her husband, Sir Denis Thatcher, died in 2003. She is survived by her children, Carol and Mark Thatcher.