The government is deciding whether there will be a bank holiday following the death of the Queen, Britain's longest serving monarch.
The UK will now enter a ten-day period of mourning, with the programme of events and tributes set to be outlined by Buckingham Palace.
In a statement on Thursday afternoon, Buckingham Palace said: "The Queen died peacefully at Balmoral this afternoon.
"The King and The Queen Consort will remain at Balmoral this evening and will return to London tomorrow."
The decision on whether there will be a bank holiday to mark the Queen's death will be made by the government and Buckingham Palace in the comings days, Downing Street confirmed later on Thursday.
It is possible a national holiday could coincide with the Queen's funeral, which is expected to be held on the final day of mourning.
Elsewhere, the Speaker of the House of Commons has announced that MPs will gather at noon in the chamber to pay their respects to the Queen.
Tributes will then continue on Saturday at 2pm in a rare weekend sitting, where a number of senior members of the government will also pledge allegiance to the King.
In a speech from Downing Street, Liz Truss said the Queen was "the rock on which modern Britain was built".
“In the difficult days ahead, we will come together with our friends across the United Kingdom, the Commonwealth and the world to celebrate her extraordinary lifetime of service,” she said.
A Number 10 spokesperson on Thursday night said the prime minister was informed of the Queen’s death at 4.30pm.
Truss spoke to the new King following her speech from Downing Street to the nation just before 7pm.
It is expected government business will be slimmed down during the period of mourning, with only the most important business in each government department continuing.
Key public services - including schools - will remain open.
Watch: Liz Truss pays tribute to the Queen, who has died aged 96
Emergency legislation on energy bills, which was outlined by the prime minister in parliament on Thursday ahead of the Queen's death, will still go head.
Outside Buckingham Palace, crowds broke out into the national anthem following the official announcement of her death, with many weeping after the flag was lowered to half mast.
The Queen's eldest son, now King Charles III, said it was "a moment of greatest sadness for me and all members of my family".
"We mourn profoundly the passing of a cherished sovereign and much-loved mother," he said in a statement.
"I know her loss will be deeply felt throughout the country, the Realms and the Commonwealth, and by countless people around the world."