The government announced that Lee, 91, "passed away peacefully" several hours before dawn at Singapore General Hospital. The increasingly frail elder statesman was hospitalized in early February with severe pneumonia.
State television broke away from its regular programming with a rolling hagiographic tribute to Lee's life and achievements. In a live broadcast, one of its reporters called the death the "awful and dreaded" news. Effusive tributes flowed in from world leaders, including President Barack Obama, Chinese President Xi Jinping and Indian Prime Minister Narendra Modi.
A self-proclaimed authoritarian who saw the world in stark realist terms, Lee commanded respect from Singaporeans, who this year will celebrate the country's 50th anniversary of independence. He led multiracial Singapore with an iron grip for more than three decades until 1990, and is credited with transforming the resource-poor island into a wealthy finance and trade entrepot with low crime and little corruption.
Singapore's government has declared seven days of national mourning, and flags will fly at half-staff on state buildings. A national holiday has not been declared, as daily life in this pragmatically commercial city of vaulting glass towers and broad, immaculate streets continues to bustle.
Still, there were tears and a deep sense of loss among Singaporeans who lionize Lee for his role in creating an oasis of stability in a region saddled with corruption, political violence and poverty. Many feel he provided them with a roof over their heads by creating a system of state-subsidized housing where the majority of Singaporeans live.
"He's my idol," said 55-year-old homemaker Lua Su Yean, standing near the sprawling display of flowers and cards left by Singaporeans at the hospital where Lee spent the last weeks of his life.
She said her "heart dropped" on hearing the news and got her husband to drive her to the hospital.
"He's done such great things and there's nothing bad I can say about him," she said. "My children grew up listening to my stories about him, and my grandchildren as well."
Lee's son, current Prime Minister Lee Hsien Loong, struggled to hold back tears in a televised address.
Speaking in Malay, Mandarin and English, the prime minister said Lee built a nation and gave Singaporeans a proud identity.
"We won't see another man like him. To many Singaporeans, and indeed others too, Lee Kuan Yew was Singapore," he said.
Under Lee and his successors, Singapore was known around the world for its strict social order, including a ban on chewing gum, restrictions on free speech, a practice of bankrupting political opponents with defamation lawsuits, and canings for crimes some countries would rule as minor. In recent years, it has become socially more liberal and the fragmented political opposition made gains in Singapore's last elections in 2011.
After stepping down as prime minister, Lee remained part of the Cabinet and an influential figure in Singapore and Asia.
His legacy is regarded within Singapore and abroad as profound, but there also is recognition that a toll was also exacted.
Phil Robertson, deputy Asia director at New York-based Human Rights Watch, said Lee's "tremendous" role in Singapore's economic development is beyond doubt. "But it also came at a significant cost for human rights, and today's restricted freedom of expression, self-censorship and stunted multi-party democracy," he said.
There were also dissenting voices in Singapore.
"This man has put in certain structures which are certainly illiberal, anti-democratic, and his passing does not mean that they no longer survive," said blogger Alex Au. "Effort is still needed to dismantle them."
Tributes from world leaders highlighted Lee's achievements.
Obama called Lee a "visionary," saying in a statement that he was "deeply saddened" to learn of his death. Obama, who met Lee during a visit to Singapore in 2009, said his "remarkable" leadership helped build one of the most prosperous countries.
He said Singapore's success meant that Lee's counsel was sought by world leaders. Lee also was "hugely important in helping me reformulate our policy of rebalancing to the Asia Pacific," Obama said.
Neighboring Malaysia, with which Singapore has had occasionally testy relations, said Lee's achievements were great and his legacy assured. "Malaysia is committed to the future of our relationship with Singapore," said Prime Minister Hajib Razak. China's Xi said Lee was a "strategist and politician widely respected by international society."
A private wake for the Lee family will take place Monday and Tuesday at Sri Temasek, the prime minister's official residence in the lush tropical grounds of the Istana government complex. After that, Lee will lie in state at parliament until a state funeral on Sunday.
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