The mystery of the muse: Anna Livia Plurabelle uncovered

So who was she, Anna Livia Plurabelle, the lady of the river, the heroine of one of the most impenetrable novels of the 20th century?

An American academic thinks she is modelled on Lucia Joyce, the disturbed daughter of James Joyce, the secret inspiration for his last and least intelligible work, Finnegan's Wake. And, now that a row over copyright has been settled, she should be better placed to prove her point.

Carol Loeb Shloss, a specialist in English and Irish literature at Stanford University, has won the right to publish extracts from letters between James Joyce and the daughter he described as having "fire in her brain". She claims they add credibility to her theory that Finnegan's Wake, published in 1939, is "an elaborate, coded mystery of an actual family". At the centre of this coded mystery, she claims, is the half-hidden figure of Lucia.

Her research has been impeded by the sensitivity of James Joyce's grandson and heir, Stephen Joyce, who has fought to prevent scholars intruding into his family's privacy. He has been especially keen to discourage any inquiries about the life of his disturbed aunt.

Ms Shloss says that, if we knew more about Lucia's madness, the language and allusions of the book would make more sense. She has sifted through all the evidence that was not destroyed by relatives or former lovers seeking to protect Lucia from curiosity. Her book Lucia Joyce: To Dance in the Wake, published in 2003, had footnotes cut to avoid a lawsuit. Stung by the reaction of critics, who described the book as interesting but short on evidence, she sued the trustee of Joyce's estate, Sean Sweeney, and Stephen Joyce, for the right to publish the excised material.

She has now won an undertaking from Joyce's estate that they will not sue, provided the material is available only in the US. Ms Shloss plans to create a printed appendix to her book and to post the missing information on a restricted website available only to users in the US.

The conflict raises the question of how far academic research should be allowed to delve into the private lives of family members of a renowned writer. The estate said they were seeking to "protect the privacy and memory" of Joyce's daughter. But Ms Shloss has accused them of wanting to fit Lucia into the easy stereotype of the "mad daughter of a man of genius" instead of granting her recognition as a gifted artist forced to live on "the margins of someone else's creativity".

Lucia was born in Trieste in 1907, in a pauper's ward, three years after her parents had left Ireland, where her father feared his genius would never be recognised. Unlike her older brother, a bonny child adored by their mother, Lucia was sickly with a bad case of strabismus (she was cross-eyed). By the time she was seven, she had lived at five addresses, because of her father's drinking and inability to pay rent. By the age of 13, she had lived in three countries. With her schooling regularly interrupted, she was said by an adult to have grown up "illiterate in three languages".

As a teenager in Paris, she made some stage appearances as a professional dancer. Her style - according to judges of a dance contest in 1929 - was "subtle and barbaric". A reviewer in the Paris Times forecast in 1928 that: "When she reaches her full capacity for rhythmic dancing, James Joyce may yet be known as his daughter's father."

She studied under Raymond Duncan, Isadora's brother, which suggests her dancing was of the wildly experimental kind in vogue in the Twenties. Her parents disapproved. So at the age of 22 - too late - she tried to switch to ballet, but gave it up. Allegedly, her mother bullied her into abandoning an activity not thought suitable for a young lady. One friend called it "vengeance of the adult on the gifted, creative child".

When Ulysses was published in 1922, making her father a star, the household became a magnet for artists, bohemians and hangers-on. Her brother took up with a much older heiress. Lucia became involved with three men in succession, all of whom rejected her. The first was Samuel Beckett. She then started meeting a sailor at the Eiffel Tower. Then she announced she was a lesbian.

Failure in love increased her worries about her strabismus. She tried an eye operation, but it did not work. She suffered another blow to her self-esteem when her parents told her they were going to marry. She thought they already had.

It was Beckett who observed that Lucia could not live a life of her own because she was "already part of a better story". For Lucia, that "better story" - her intense, almost incestuous relationship with her father - drove her mad. "Whatever spark or gift I possess has been transmitted to Lucia and it has kindled a fire in her brain," he wrote.

In February 1922, a family argument developed as they celebrated his fiftieth birthday. Lucia picked up a chair and threw it at her mother. Her brother checked her in at a clinic. She was only 25, but became trapped in a life that alternated between institutionalisation and unhappy visits home.

Her stays in clinics grew longer as her behaviour became more erratic. She shuffled between French and Swiss institutions. Her therapists were divided over whether she was schizophrenic, manic depressive, or merely neurotic. Carl Jung came to look at the famous writer's daughter, but she did not like him. "To think that such a big, fat materialistic Swiss man should try to get hold of my soul," she said.

During a period of freedom, in Ireland, she committed arson, made lurid advances at her cousins' boyfriends, left a gas tap turned on at night, and ran off to Dublin where, for six days, she wandered the streets her father wrote of in Ulysses. She was permanently in institutions from the age of 28 until her death in 1982, aged 75. Once, her mother asked if her father should visit her. Lucia replied: "Tell him that I am a crossword puzzle, and if he does not mind seeing a crossword puzzle, he is to come out."

She was with her parents in 1933, when a US District Court ruled that Ulysses could be published in the US, despite protests that it was obscene. As the phone rang with congratulatory calls, Lucia cut the wire shouting: "C'est moi qui est l'artiste!" When the wires were repaired, she cut them again.

Later, according to Ms Shloss, her father came to understand that he might have some responsibility for her mental state, and wanted to bring her home. But Joyce was going blind, and his family and friends feared he might never finish Finnegan's Wake, a novel they believed would alter the course of literature.

His wife, Nora, often the target of Lucia's fury, did not want her daughter at home. Nor did Giorgio, that bonny boy who had turned into an idle alcoholic. Explaining her problems to clinic staff, Joyce wrote: "The patient insists that, despite her diligence, her talent and all her exertions, the results of her work have come to nothing. The brother, her contemporary, whom she previously idolised, has never worked at anything, is well known, has married wealth, has a beautiful apartment, a car with a chauffeur and, on top of it all, a beautiful wife."

Giorgio's son, Stephen, has fought to keep his aunt's story private. He destroyed her letters to him, and persuaded Beckett to follow his example. In 1989 he wrote in The New York Times Book Review: "The Joyce family's privacy has been invaded more than that of any other writer in this century."

In the suit Ms Shloss filed in San Francisco, she said: "People have destroyed documents about Lucia Joyce for over 60 years, apparently due largely to the stigma that previous generations attached to young women who had suffered emotional trauma."

She said she had spent 15 years working on the book, and was convinced Lucia was a consistent source of inspiration to her adoring father. One witness remembered seeing Joyce working on the Wake as his daughter danced silently in the background. Ms Shloss suggests that father and daughter could "communicate with a secret, inarticulate voice", and that the dancing shaped some of the word rhythms of Finnegan's Wake.

She believes Lucia was the model for Anna Livia Plurabelle and that she said the words which could be a summary of her life: "My leaves have drifted from me. All. But one clings still. To remind me. Lff! So soft this morning, ours. Yes. Carry me along, taddy, like you done through the toy fair!"