Lady Thatcher met the Pope in St Peter's Square yesterday morning immediately after his weekly audience at the Vatican.
The 83-year-old former prime minister was accompanied by her biographer Charles Moore, the former Telegraph editor and Catholic convert, and her old friend Paul Johnson, a journalist and life-long Catholic.
Lady Thatcher, who was raised a Methodist, flew to Rome with her daughter Carol on Friday, as The Independent disclosed last week.
Her meeting with the Pontiff was arranged by Carla Powell, whose husband Charles (now Lord Powell) was a key foreign policy adviser to her government. The Powells were hosting Lady Thatcher, who has been suffering from dementia, in their villa in Palombara Sabina on the outskirts of Rome. She is expected to fly back later this week.
Wearing a smart black dress with veil, the former Conservative leader shook hands with Pope Benedict XVI and smiled in the Roman sunshine. She spoke to the Pope for several minutes with the aid of Lord Powell and Mr Moore.
Lady Thatcher's health is described by those around her as stable. She had an unusually busy schedule last week, meeting the Queen, also 83, at two separate functions before undertaking the two-and-a-half hour flight from London to Rome. Her short-term memory has deteriorated slowly since she suffered a series of minor strokes in 2002, but sources close to her say that her diary is packed until August.
Gordon Brown, whose father was a Church of Scotland minister, visited the Pope in February, while Prince Charles and the Duchess of Cornwall met him last month. Lady Thatcher first visited the Vatican in 1977, when as leader of the Opposition she met Pope Paul VI. She had good relations with his successor, Pope John Paul II, who helped her to end a series of Republican hunger strikes at the Maze prison in 1980.
Lady Thatcher's father, Alfred Roberts, served as an alderman and Methodist lay preacher in the family's home town of Grantham in Lincolnshire.