His wife Blanche d'Alpuget released a statement on Thursday night confirming he died peacefully at home on Thursday.

"Today we lost Bob Hawke, a great Australian - many would say the greatest Australian of the post-war era," she said.

"Bob was dearly loved by his family, and so many friends and colleagues. We will miss him.

"The golden bowl is broken.

"Bob Hawke and Paul Keating and their governments modernised the Australian economy, paving the way for an unprecedented period of recession-free economic growth and job creation."

Ms d'Alpuget will hold a private funeral with his children Sue, Stephen, Rosslyn and stepson, Louis, and his grandchildren.

A memorial service for Australia's 23rd prime minister will be held in Sydney in coming weeks.

Mr Hawke led Labor to victory at the 1983, 1984, 1987 and 1990 elections, and his government went on to establish Medcare and Landcare, floated the Australian dollar and is credited, along with Paul Keating, with modernising the Australian economy.

Mr Hawke was Labor's most successful federal leader, known as much for his larrikinism as he was his policies that helped modernise post-war Australia.

He frequently sculled beers, making the Guinness Book of Records for downing a yard glass while a Rhodes Scholar at Oxford and even in his later years would indulge fans at the cricket by knocking back drinks.

But he gave up the drink while prime minister and proudly boasted he "didn't touch a drop" while in the top job.

The former ACTU leader rose through union and Labor ranks and won the party four elections, with his wife and mother to their children Hazel by his side.

But in 1991 he was dumped and replaced by his treasurer Paul Keating, his marriage hit the rocks and they eventually divorced, with Mr Hawke going on to marry Ms d'Alpuget in 1995.

Opposition leader Bill Shorten paid tribute to Mr Hawke, saying the labour movement "salutes our greatest son".

"The Labor Party gives thanks for the life of our longest-serving prime minister and Australians everywhere remember and honour a man who gave so much to the country and people he cared for so deeply," he said in a statement.

"The Australian people loved Bob Hawke because they knew Bob loved them, this was true to the very end.

"He was a leader of conviction - and a builder of consensus. But for Bob, consensus and co-operation never meant pursuing the lowest common denominator."

Mr Shorten made a short statement, in person, in Sydney.

"Tonight the nation and Labor are in mourning. We have lost a favourite son," he said.

"Bob Hawke loved Australia and Australia loved Bob Hawke. But his legacy will endure forever.

"Bob Hawke changed Australia for the better. He brought people together, he modernised our economy, he transformed our society, he protected our environment."

Paul Keating, who served as treasurer under Mr Hawke and defeated him in a leadership ballot to become prime minister in 1991, said the death also represented the passing of "a partnership we formed with the Australian people".

"Bob possessed a moral framework for his important public life, both representing the workers of Australia and more broadly, the country at large," Mr Keating said on Thursday night.

"Bob, of course, was hoping for a Labor victory this weekend. His friends, too, were hoping he would see this.

"In what was our last collaboration, Bob and I were delighted to support Bill Shorten last week in recounting the rationale we employed in opening Australia to the world," he said.

"The country is much the poorer for Bob Hawke's passing."

Ms d'Alpuget said, "Bob's consensus-style approach of bringing together the trade union movement and the business community boosted job opportunities while increasing the social wage through Medicare and extra financial support for low-income families.

"Together with his highly talented cabinets, he foresaw the Asian Century and positioned Australia to take full advantage of it through a program of sweeping economic reforms.

"Among his proudest achievements were large increases in the proportion of children finishing high school, his role in ending apartheid in South Africa, and his successful international campaign to protect Antarctica from mining.

"He abhorred racism and bigotry. His father, the Reverend Clem Hawke, told Bob that if you believed in the Fatherhood of God then you must also believe in the Brotherhood of Man. Bob would add today the Sisterhood of Women."

Prime Minister Scott Morrison praised Mr Hawke as a great Australian who served his country with "passion, courage and an intellectual horespower".

Tony Abbott has joined the list of former prime ministers paying tribute to Mr Hawke describing him as "Labor's greatest prime minister" who changed "our country for the better".

Mr Abbott said that Mr Hawke's key achievements went against the "Labor grain" adding that in his view Mr Hawke had a "Labor heart" but a "Liberal head".

Former prime minister Paul Keating, who was Mr Hawke's treasurer, before challenging him for Labor leadership, also issued a statement on Thursday night.

"With Bob Hawke's passing today, the great partnership I enjoyed with him passes too. A partnership we forged with the Australian people.

"But what remains and what will endure from that partnership are the monumental foundations of modern Australia."

Mr Keating added: "The country is much poorer for Bob Hawke's passing".

Former prime minister Kevin Rudd described him as a "giant of Australian politics".

Former prime minister Malcolm Turnbull said Australia was a better place because of Mr Hawke .

ACT Chief Minister Andrew Barr posted his thoughts on Facebook.

"Tears will be shed across the nation for Bob Hawke. I am crying as I write this post," he said.

"Bob will be forever remembered as one of our nation's greatest leaders. Together with Paul Keating, he built modern Australia."

He said Mr Hawke paved the way for many significant social reforms, and Medicare and Australia's world leading public health system would be his legacy.

"Bob was a great advocate for Canberra and did much to support our city's growth and prosperity," he said.

"The Hawke government recognised the significant democratic deficit from federal rule in the ACT and granted us self-government."