In a review for the Daily Telegraph newspaper of a biography of Enoch Powell, the former prime minister reveals her regret over the deal she signed with Garrett FitzGerald, the then Irish prime minister, at Hillsborough in 1985.
Ulster Unionists condemned the agreement at the time as a betrayal and the first step towards a united Ireland.
Mr Powell was then an Ulster Unionist MP, having quit the Conservatives over Europe in 1974.
He said the accord resulted in an unprecedented arrangement granting foreign ministers oversight of part of the United Kingdom.
In a bitter exchange with her in the Commons the day before it was signed, he accused her of "treachery".
In her review of the biography by the political commentator Simon Heffer, Lady Thatcher writes of the former minister's objection to the accord.
"I now believe that his assessment was right, though I wish that on this as on other occasions he had been less inclined to impugn the motives of those who disagreed with him."
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She says that "Powellism" helped to create "Thatcherism" and says she is glad that during her last period in office and afterwards they became closer again.
Lady Thatcher also says she believed Sir Edward Heath should not have sacked Mr Powell, who died last February, from the Tory shadow cabinet in 1968 for his controversial anti-immigration "rivers of blood" speech.
"I told Ted then that I thought it best just to let things cool down and that it would be unwise to dismiss someone like Enoch," she writes.
"Looking back, I can see that it was not just unwise, it was disastrous."
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