No, she’s not dead yet (I thought the same thing). It’s just that the planning stages for her funeral are underway and according to officials it will be a formal state funeral, not seen since the funeral of Winston Churchill. Thatcher, now 82, is said to be in good health but people are getting ready. From the article (so you don’t have to go to Wikipedia):
In the 19th century, four state funerals were granted to “commoners” – Lord Nelson after his death at Trafalgar, the Duke of Wellington, a prime minister as well as victor over Napoleon at the battle of Waterloo, Lord Palmerston and William Gladstone, both popular inhabitants of No 10.