Princess Galyani had been ill since the middle of 2006
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The elder sister of Thailand's revered King Bhumibol Adulyadej has died of abdominal cancer at the age of 84.
Princess Galyani Vadhana died early on Wednesday morning in the Bangkok hospital where she had been receiving treatment since June last year.
An academic specialising in French literature, the princess was involved in health, education and arts projects.
Her funeral will be held at the Grand Palace and a 100-day mourning period has been declared.
Hundreds of Thais assembled at the hospital after the announcement, many of them wearing black.
"This is a great loss for me and the country," mourner Banchong Rodgan told Reuters news agency.
Uncertainty
Mourners assembled outside the hospital where the princess died
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Local media had provided regular updates as the princess' condition worsened, and King Bhumibol had visited his sister on an almost daily basis.
In October, the 80-year-old monarch was admitted to the same hospital as his sister for three weeks after suffering from inadequate blood flow to the brain.
This triggered acute public concern - the much-loved king is viewed as a key source of national unity amid ongoing political uncertainty.
Princess Galyani's death brought a temporary halt to negotiations between political parties in the wake of last month's general election - the first since the military coup in September 2006.
The People Power Party, which backs ousted leader Thaksin Shinawatra, emerged well ahead of its main rival, the Democrat Party, in the 23 December polls.
But it fell short of the 240 seats need for a majority and is currently in the process of forming a coalition with smaller parties.
Announcements are expected in the next few days.
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