The best-selling writer, known for her wit and warmth, passed away in hospital on the remote Pacific outcrop of Norfolk Island where she lived for most of the last four decades, after suffering a series of small strokes.
Prime Minister Tony Abbott described her as "a unique Australian personality and Norfolk Island's most famous resident".
"She enthralled readers for decades and she will be missed," he said.
Her publisher HarperCollins Australia said McCullough had fought through a string of health problems to continue writing via dictation.
"Ever quick-witted and direct, we looked forward to her visits from Norfolk Island and the arrival of each new manuscript delivered in hard copy in custom-made maroon manuscript boxes inscribed with her name," publishing director Shona Martyn said.
"The world is a less colourful place without Col."
Martyn said she was proud to be an author of popular fiction "writing for a broad audience rather than the elite."
McCullough penned 25 novels, including her first, "Tim", which was made into a 1979 film starring Mel Gibson. The last, "Bittersweet", was published in 2013.
The paperback rights for the 1977 novel "The Thorn Birds", her second book set on a fictional sheep station, were auctioned for $1.9 million, reportedly a record at the time.
In 1983 it became a top-rating television mini-series starring Richard Chamberlain and Rachel Ward, but an unimpressed McCullough told the Daily Mail it was "instant vomit".
The Australian newspaper described her as a "true national treasure" who "told a good story -- usually peppered with profanities -- about the most intimate details of her life."
Fellow Australian author Tara Moss described her as irreplaceable.
"She was fierce, funny and so supportive of other writers. Irreplaceable. RIP Colleen," she said on Twitter.
Literary agent Selwa Anthony, a close friend of McCullough's, said: "She wrote what she wanted".
When publishers demanded another Thorn Birds, McCullough wrote a series of thrillers, Anthony told the Sydney Morning Herald.
- Unhappy childhood -
"RIP Colleen McCullough. I can't think of anyone who took such a miserable childhood and turned into a life of such luminous achievement," tweeted 702 ABC Sydney presenter Richard Glover.
McCullough, who is survived by her husband Ric Robinson, a Norfolk Islander, was born in Wellington in New South Wales state but spent most of her childhood in Sydney.
In interviews, she spoke of growing up amid warring parents, with a mother she once called "deliberately cruel" and an itinerant worker father who was found out after his death to have had at least two other wives.
In a happier memory, the Australian Broadcasting Corporation described her telling of having once gone to town on a coat-buying mission with money from her mother, but deciding on a typewriter instead.
"So I went to town with the five pounds to buy an overcoat, and I saw a Blue Bird portable typewriter for five pounds so I bought that instead," she said.
She was a model student and in her first career set up the neurophysiology department at Sydney's prestigious Royal North Shore Hospital before heading to England and then spending a decade at Yale Medical School in the United States.
It was there that she decided to write the best-seller, "Tim" which was an instant success reportedly raking in US$50,000.
Within three years McCullough switched to full-time writing and while considered a novelist her work spanned family life, crime and history, including the heavyweight Masters of Rome series, as well as two cookbooks.
In 2004, she told a television interviewer she had already lost sight in one eye due to hemorrhagic macular degeneration, an irreversible and progressive illness.
"Every book from now I have to think maybe the last one," she said, saying learning she would lose her sight was more frightening than an earlier brush with cancer.
