Lubaina Himid, an artist who makes theatrical, witty and challenging works that address colonial history, racism and institutional invisibility, has won the 2017 Turner prize.

Himid is both the first woman of colour to win and, at 63, the oldest winner in the prize’s 33-year history, after it dropped its upper age limit of 50.

She is an artist who, arguably, has been overlooked and undervalued for most of her career. On Tuesday night that changed when she was announced as the winner at a prize ceremony in Hull broadcast live on BBC Four.

Himid – born in in Zanzibar, Tanzania and now based in Preston, Lancashire – thanked the people who gave her sustenance during her “wilderness years”.

She said she was never overlooked by curators or other artists but she was never in the press, perhaps because her work “was too complicated to talk about”.

She added: “I guess the issues I was dealing with were complex, many-layered, and you’ve got to sell newspapers.”

Winning the prize meant a lot to her, she said. “I won it for all the times where we put our heads above the parapet, we tried to do things, we failed, people died in the meantime … for all the black women who never did win it even though they had been shortlisted … it feels good for that reason.”

Himid wins £25,000, money which she will spend on commissioning other artists and, perhaps, the odd pair of shoes.

Alex Farquharson, director of Tate Britain and chair of the judging panel, said Himid made works that were courageous, addressing “difficult, painful” issues.

Himid’s Swallow Hard: the Lancaster Dinner Service, 2007, by Lubaina Himid. Photograph: David Levene for the Guardian

She won for three exhibitions of her work in Bristol, Oxford and Nottingham.

“Together they offered a great summation of her practice over the last few decades and also revealed how vital her work is at the present moment,” Farquharson said.

The Turner prize, one of the world’s best-known contemporary art prizes, exists to “promote public debate around new developments in contemporary British art”.

Some have questioned whether Himid’s collection fits that mission, given that it includes work dating back to 1987.

But Farquharson said all of Himid’s work, whether from the 1980s or from now, felt particularly “resonant and relevant” today.

He said many of her pieces seemed to have acquired more meaning and people were more ready for them. “They speak to the present moment which has been one of division both in Britain and in America.”

The 1987 work on display at Hull’s Ferens Gallery, host to the Turner prize as part of its City of Culture celebrations, is a large and busy stage set of wooden and mixed-media cut-out figures inspired by Hogarth’s Marriage à la Mode. It is easily dateable by the inclusion of Margaret Thatcher and Ronald Reagan as flirting lovers.

Another work, from 2007, is crockery she has painted with scenes of slavery from Britain’s colonial history.

Himid is not afraid of making well-intentioned liberals feel uncomfortable. On another wall in the Hull show are pages she has torn from the Guardian featuring images of black people.

She dissects the pages for unconscious racial stereotyping, and has painted over them, arguing that the words used in headlines or the pictures that are chosen often amount to caricature.

Himid said the series about the Guardian – a paper she loved – stemmed from when she saw images of black people being juxtaposed with text that had nothing to do with each other as the 200th anniversary of the abolition of slavery approached in 2007.

Other newspapers were worse. “However, I believed in the Guardian, like some people believe in football teams and I didn’t want my newspaper which made me laugh and made me feel part of a club to do that, and because I hold that newspaper in high regard it needs to behave better.”

Negative Positives: the Guardian Archive, 2007-2015 by Lubaina Himid. Photograph: David Levene for the Guardian

Himid was given her prize by the DJ, producer and artist Goldie.

Farquharson said the jury’s deliberations had been “good-tempered, good-humoured and serious” and by the end it was a unanimous decision.

Himid was chosen from a shortlist that also included the Birmingham-born painter Hurvin Anderson, who had been the bookmakers’ joint favourite with Himid to win the prize.

The other nominees were Croydon-born Rosalind Nashashibi for two films, one set in Gaza, the other in Guatamala; and Stuttgart-born Andrea Büttner, whose practice includes printmaking, sculpture and archival works. Her display at Hull included colourful 2 metre-tall etchings she made of smudges on her iPhone.

The Turner prize often manages to delight and exasperate in equal measure, but most observers felt it seemed more serious this year than in previous years. Perhaps a good thing. There was none of the more wacky art that has grabbed headlines in the past: no lights in a room being turned on and off, no debating economics with gallery staff and no giant naked backside.

It was the first full year of a rule change abandoning the upper age limit of 50 for artists, a restriction introduced in 1991. Some critics said it gave the Turner prize a more mature feel.

Farquharson said it was striking that Himid was the oldest ever artist to win but that “ultimately it has been about her work. Primarily her artwork but also her example as a curator and educator.”

Himid is a professor of contemporary art at the University of Central Lancashire. She was born in Zanzibar and was brought to Britain as a child by her Blackpool-born mother and raised in London.

Winning the Turner prize brings a useful £25,000 but, more than that, it dramatically raises an artist’s profile and, in theory, widens their opportunities. Previous winners include Rachel Whiteread, Damien Hirst, Grayson Perry, Jeremy Deller and, last year, Helen Marten.