The nation's "model of the year" in 1949, who went on to establish a personal-development school in 1950, died peacefully on Saturday night surrounded by her family, they said in a statement.

The June Dally-Watkins School trained women in deportment and etiquette but June also established a modelling agency and business college.

She was awarded the Medal of the Order of Australia in 1993 for services to business and in 2014 was named one of the 100 "Australian legends" who helped shape the nation.

Dally-Watkins had recently been teaching etiquette to millions of students across China "with great success", her family said in Sunday's statement.

ABC chairwoman Ita Buttrose, was friends with Dally-Watkins for decades, says she encouraged people to be kind to one another and say please and thank you.

"As well as being a beautiful woman and a model, she was a very smart businesswoman - she just knew how to teach people the art of being elegant, the art of being civilised," Ms Buttrose told the ABC on Sunday.

Dally-Watkins was born June Marie Skewes on June 12 in 1927 after her unmarried mother, Caroline Mary Skewes, left the family sheep property at Watsons Creek, in NSW's New England region, to give birth in Sydney.

The stigma of illegitimacy lingered. Dally-Watkins wrote in her 2002 autobiography, Secrets Of My Smile, that "the hush-hush surrounding my father and my identity became deafening and continued to echo throughout my life ... So I masked my shame and buried my self-consciousness with a smile - something I've done all my life, on and off the catwalk".

Dally-Watkins is survived by four children, seven grandchildren and one great-grandchild.

Australian Associated Press