Margaret Thatcher announced her resignation as Prime Minister 20 years ago yesterday on one of Westminster’s most momentous days.

The Iron Lady finally announced she was standing down after a series of Tory grandees and Cabinet ministers told her she had to go.

It brought to an end her 11 tumultuous years as Prime Minister and paved the way for John Major’s premiership, although her shadow would continue to hang over the Conservative Party.

She told the Cabinet of her decision at 9 a.m. in a sombre voice and close to tears.

She had been warned she faced humiliation against bitter rival Michael Heseltine in the second ballot for the Tory leadership.

The drama that led to the resignation began in the British Embassy in Paris the previous Tuesday evening.

Mrs Thatcher heard, to her dismay, that her majority over Mr Heseltine was insufficient to avoid a second ballot.

She insisted she would go on, famously proclaiming: “I fight on. I fight to win.”

But a series of consultations with colleagues made her aware of how precarious her position was becoming.

Tory backbenchers who had supported her in the first round were beginning to express doubts publicly about backing her in the next phase.

She could afford to lose no more than 18 votes – or face ignominious defeat at the hands of the man who tried to humiliate her over the Westland Helicopters affair five years before.

Mrs Thatcher then sought the opinions of as many Cabinet ministers as she could.

To each of them, as they entered her room at the Commons last night, she said: “It’s a funny old world. I have won three general elections in succession. I have the overwhelming support of the Tory Party in the country.

“I have never lost a censure or a confidence motion in all that time. In the first ballot for the leadership elections I had the support of a substantial major-ity of Tory MPs. And yet my leadership is being cast in doubt.”