The Williams F1 team dominated much of the 1980s and 1990s under his guidance.
The team built in his name grew into one of the most successful in the sport, winning seven drivers’ titles and nine constructors’ championships.
“It is with great sadness that on behalf of the Williams family, the team can confirm the death of Sir Frank Williams CBE, Founder and Former Team Principal of Williams Racing, at the age of 79,” the team said.
“After being admitted into hospital on Friday, Sir Frank passed away peacefully this morning surrounded by his family.
“Today we pay tribute to our much loved and inspirational figurehead. Frank will be sorely missed. We request that all friends and colleagues respect the Williams family’s wishes for privacy at this time.”
Williams sustained a spinal cord injury in a 1986 car crash which left him unable to walk.
He stepped down from the Williams’ board in 2012, and handed over day-to-day running of the team to his daughter Claire in 2013.
Williams and his family sold the team to investment firm Dorilton Capital in the last 12 months.
Williams’ current CEO and team principal Jost Capito paid tribute to the team’s founder.
“The Williams Racing team is truly saddened by the passing of our founder Sir Frank Williams,” he said.
“Sir Frank was a legend and icon of our sport. His passing marks the end of an era for our team and for the sport of Formula 1. He was one of a kind and a true pioneer. Despite considerable adversity in his life, he led our team to 16 World Championships, making us one of the most successful teams in the history of the sport.
“His values including integrity, teamwork and a fierce independence and determination, remain the core ethos of our team and are his legacy, as is the Williams family name under which we proudly race. Our thoughts are with the Williams family at this difficult time.”
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