Baroness Thatcher, Britain's first and only female prime minister, died this morning aged 87 following a stroke.

Her spokesman Lord Bell said: "It is with great sadness that Mark and Carol Thatcher announced that their mother Baroness Thatcher died peacefully following a stroke this morning. "

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Lady Thatcher will not have a state funeral but will be accorded the same status as Princess Diana and the Queen Mother.

Downing Street announced that, with the Queen's consent, Lady Thatcher will receive a ceremonial funeral with military honours at St Paul's Cathedral.

A wide and diverse range of people and groups with connections to Lady Thatcher will be invited. The service will be followed by a private cremation.

All the arrangements being put in place are in line with wishes of her family. Further details will be published over the coming days.

Buckingham Palace said in a statement: "The Queen was sad to hear the news of the death of Baroness Thatcher. Her Majesty will be sending a private message of sympathy to the family."

David Cameron led the political tributes, saying: "Today is a truly sad day for our country. We've lost a great prime minister, a great leader, a great Briton.

"As our first woman prime minister, Margaret Thatcher succeeded against all the odds, and the real thing about Margaret Thatcher is that she didn't just lead our country, she saved our country, and I believe she'll go down as the greatest British peacetime prime minister.

"Today is obviously a day we should most of all think of her family. We've lost someone great in public life but they've lost a much-loved mother and grandmother and we should think of them today.

"Her legacy will be the fact she served her country so well, she saved our country and that she showed immense courage in doing so.

"And people will be learning about what she did and her achievements in decades, probably centuries to come. That's her legacy but today we must also think of her family."

Liberal Democrat leader Nick Clegg said: "Margaret Thatcher was one of the defining figures in modern British politics.

"Whatever side of the political debate you stand on, no-one can deny that as prime minister she left a unique and lasting imprint on the country she served.

"She may have divided opinion during her time in politics but everyone will be united today in acknowledging the strength of her personality and the radicalism of her politics. My thoughts are with her family and friends."

First Minister Alex Salmond said: "Margaret Thatcher was a truly formidable prime minister whose policies defined a political generation.

"No doubt there will now be a renewed debate about the impact of that legacy. Today, however, the proper reaction should be respect and condolences to her family."

Labour leader Ed Miliband said: "I send my deep condolences to Lady Thatcher's family, in particular Mark and Carol Thatcher.

"She will be remembered as a unique figure. She reshaped the politics of a whole generation. She was Britain's first woman Prime Minister. She moved the centre ground of British politics and was a huge figure on the world stage.

"The Labour Party disagreed with much of what she did and she will always remain a controversial figure. But we can disagree and also greatly respect her political achievements and her personal strength.

"She also defined the politics of the 1980s. David Cameron, Nick Clegg and I all grew up in a politics shaped by Lady Thatcher. We took different paths but with her as the crucial figure of that era.

"She coped with her final, difficult years with dignity and courage. Critics and supporters will remember her in her prime."

Former prime minister Tony Blair said: "Margaret Thatcher was a towering political figure. Very few leaders get to change not only the political landscape of their country but of the world.

"Margaret was such a leader. Her global impact was vast. And some of the changes she made in Britain were, in certain respects at least, retained by the 1997 Labour Government, and came to be implemented by governments around the world.

"As a person she was kind and generous spirited and was always immensely supportive to me as Prime Minister although we came from opposite sides of politics.

"Even if you disagreed with her as I did on certain issues and occasionally strongly, you could not disrespect her character or her contribution to Britain's national life. She will be sadly missed."

Former prime minister Gordon Brown said: "She will be remembered not only for being Britain's first female Prime Minister and holding the office for 11 years, but also for the determination and resilience with which she carried out all her duties throughout her public life.

"Even those who disagreed with her never doubted the strength of her convictions and her unwavering belief in Britain's destiny in the world.

"During our time in Number 10, Sarah and I invited Lady Thatcher to revisit Downing Street and Chequers - something which we know she enjoyed very much. But it was sad for her and her family that she lost her devoted husband Denis almost 10 years ago and that she was unable to enjoy good health in the later years of her retirement."

London Mayor Boris Johnson said Britain had lost its greatest prime minister since Winston Churchill.

"Margaret Thatcher freed millions of people to buy their own homes and buy shares in British companies," he said.

"She ended the defeatism and pessimism of the post-war period and unleashed a spirit of enterprise.

"She fought against the clubby, cosy, male-dominated consensus of both main parties - and she won.

"Her beliefs - in thrift, hard work, and proper reward for merit - were not always popular. But her legacy is colossal.

"She was right about the unions, she was right about Soviet communism and recent events have shown that she was completely right about the euro.

"This country is deeply in her debt. Her memory will live long after the world has forgotten the grey suits of today's politics."

Lord Sugar added: "Margaret Thatcher died today. A great lady she changed the face of British politics, created opportunity for anyone to succeed in the UK. RIP.

"Baroness Thatcher in the 80s kick-started the entrepreneurial revolution that allowed chirpy chappies to succeed and not just the elite."

Former Conservative prime minister Sir John Major described Baroness Thatcher as a "true force of nature" and a "political phenomenon".

He said: "In government, the UK was turned around under - and in large measure because of - her leadership.

"Her reforms of the economy, trades union law, and her recovery of the Falkland Islands elevated her above normal politics, and may not have been achieved under any other leader.

"Her outstanding characteristics will always be remembered by those who worked closely with her: courage and determination in politics, and humanity and generosity of spirit in private."

Conservative MP John Redwood said Thatcher had "won the Cold War".

One of the former prime minister's advisors, Lord Dobbs, said: "She was an extraordinary woman and a great prime minister - one of the greatest we have ever had and the greatest peacetime prime minister of the 20th century."

Baroness Thatcher's former Cabinet minister Norman Tebbit said: "It's immensely sad that we have lost one of the greatest political figures of the second half of the 20th century.

"I was proud to have served in her government and to have worked with her in those years. We could do with another one like her right now."

Labour former home secretary David Blunkett said: "Margaret Thatcher was a most formidable opponent, undoubtedly an outstanding leader and, as the first woman prime minister in the United Kingdom, a groundbreaking politician.

"I have to acknowledge her deep commitment to her own values and her determination, although, with Bernard Ingham at her side, she was the first modern exponent of carefully worked spin, which allowed her to present compromise as merely delay, and deep irritation with opponents in her own party as principled stance.

"She said she could not forgive the leadership of her own party for her downfall, and I have to say that I cannot forgive her for what she did to my city of Sheffield, the mass redundancies, the damage to productive industry and the use of incapacity benefit as a tool to avoid internal social breakdown."

He went on: "In simple terms, we should remember her for what she was. A remarkable woman, a divisive figure but a politician who could mobilise both support and opposition in a way that fired British politics."

Work and Pensions Secretary Iain Duncan Smith said Baroness Thatcher was "the reason I came into politics".

He said: "Watching her set out to change Britain for the better in 1979 made me believe there was, at last, real purpose and real leadership in politics once again.

"She bestrode the political world like a colossus. This is dreadfully sad news and my thoughts and prayers are with her family."

Senior Tory MP David Davis said: "Margaret Thatcher was the greatest of modern British prime ministers, and was central to the huge transformation of the whole world that took place after the fall of the Soviet Union.

"Millions of people in Britain and around the world owe her a debt of gratitude for their freedom and their quality of life, which was made possible by her courageous commitment to the principles of individual freedom and responsibility.

"Her passing is a very sad event and she will be greatly missed."

UKIP leader Nigel Farage said she was a "great patriotic lady".

Labour MPs also paid tribute to Baroness Thatcher on Twitter.

Shadow International Development Secretary Ivan Lewis said: "Hoping all Labour supporters will respond with dignity + respect to news of Baroness Thatcher's death. Our thoughts with her family + friends."

And former Labour minister and MP Tony McNulty tweeted: "God bless her and thoughts are with her family. RIP."

Liberal Democrat MP Martin Horwood tweeted: "Sad news about Baroness Thatcher. Don't miss her policies but a towering figure in 20th c British politics, & made history UK's 1st woman PM."