London - Firemen fought for half an hour tonight before ripping the smouldering garment off the ex-PM's arse.
A sudden flare-up of spontaneous combustion saw her Marks N Sparks knicks burst into flame just as news of the former Soviet President's death broke.
A few minutes later it was all over as TV networks reported a hoax tweet was responsible for the scam.
So far this evening no one has admitted the prank which some analysts reckon originated in plush Chester Square, Belgravia, London SW1.
"It was five past six when we noticed some thick, acrid smoke wafting over from under Mrs T's dress," the PM's carer told the Fire Brigade.
A damned good soaking later and the flames were still flickering necessitating the use of breathing apparatus and other high tech stuff.
It's now emerged that the rogue RIP tweet may be linked to
a private bet between the two Cold War mobsters.
Apparently Mrs Thatcher stands to win a million quid if her former adversary Mikhail Gorbachev kicks the bucket before she does.
At 81 he's no spring chicken and at 84 neither is she.
Of course she's vehemently denying starting tonight's spoof.