'Lotto gran' Susanne Hinte is believed to have had a heart attack at her home in Worcester yesterday afternoon.
The grandmother-of-four contacted Camelot last year after claiming she found the winning ticket in her jeans which had been damaged in the wash.
Ms Hinte, known to friends as Sanne, alleged she had won half the £66million jackpot from the draw in January 2016 after it was revealed the winning ticket was bought in her hometown.
But when German-born Ms Hinte sent in the crumpled ticket, investigators from Camelot's security team soon determined the ticket was not correct.
Neighbours described how police and an ambulance crew suddenly raced to Ms Hinte's home yesterday afternoon. Speaking outside the family home, Miss Hinte's daughter Natasha Douglas, 29, said: 'I'm too upset to talk - my mum only died yesterday.'
One neighbour, who asked not to be named, told the Worcester News he thought Ms Hinte's daughter had raised the alarm after her mother did not answer the door.
He said: 'It was about 6pm last night. The ambulance came quite quickly about three or four minutes. They were only in there 90 seconds. I just knew she had died.
'Another car came racing up – then a saw a guy run up – the person was in no rush. I thought it can't have just happened - she must have been gone.'
Another neighbour added: 'The family have been there all day and they are in bits.
'She was a controversial woman but she had a very loving family. Even though she had this heart condition, everyone is in deep shock.