- Ms Bettencourt was 14th richest person in world, says Forbes magazine
- Net worth estimated to be $39.5 billion in March this year
- Was reportedly suffering from mixed dementia and Alzheimer's disease
"Liliane Bettencourt died last night at home," her daughter Francoise Bettencourt Meyers said in a statement. "My mother left peacefully."
Bettencourt, the cosmetics giant's principal shareholder, was the 14th richest person in the world, according to Forbes magazine, which estimated her net worth in March at $39.5 billion (33 billion euros).
She was rarely seen in public since leaving the L'Oreal board in 2012, but her name remained in the headlines as members of her entourage were charged with exploiting her failing mental health.
Bettencourt had been declared unfit to run her own affairs in 2011 after a medical report showing she had suffered from "mixed dementia" and "moderately severe" Alzheimer's disease since 2006.
The complex legal case involved a bitter feud with her only daughter and unscrupulous friends, and even dragged in former president Nicolas Sarkozy.
Patrice de Maistre, who managed Bettencourt's vast fortune, was accused of getting her to hand over envelopes of cash to members of Sarkozy's right-wing UMP party during his 2007 presidential campaign.
The charges against Sarkozy were dropped in October 2013 due to lack of evidence.