The proprietress of Elaine's, who had been in failing health, died at 12:20 p.m. at Lenox Hill Hospital, said Cindy Carway, a spokeswoman for the Second Avenue restaurant.
“Elaine was a New York institution," said Mayor Bloomberg.
Kaufman died from complications stemming from emphysema.
"Writers have never come to my place to talk about literature," Elaine told Vanity Fair magazine last year in an article about her and her bar, which became memorialized in print and in Billy Joel's hit "Big Shot."
"They come to escape writing."
A memorial service was expected to take place sometime next year, although no date has been set.
Writer Gay Talese, a regular at the restaurant since 1964, a year after she opened it, said, "What she did that stood out was -- she stood out. She was there in italics."
He said her generosity to writers was unique.
"No sane restaurant in New York is friendly to writers because they don;t have money or if they do they don't spend it on restaurants," he said. "She cultivated writers because she was the only restaurant owner in New York who finished (reading) a book."
Dominic Chianese said long before he became famous in the cast of the HBO hit "The Sopranos," Kaufman "was like an older sister to me, someone I could confide in."
Elaine Kaufman Dies Aged 81
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