MONACO-RAINIER - 04/06/2005 08:30 GMT - AFP

by Frederic Peugeot
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MONACO, April 6 (AFP) - Prince Rainier of Monaco died on Wednesday at the age of 81 after weeks in intensive care fighting heart, lung and kidney problems, the royal palace said, ending a life marked by Hollywood glamour after his marriage to Grace Kelly.
The prince passed away at 6:35 am (0435 GMT), a palace official told AFP.
Rainier -- who ruled the tiny Mediterranean principality since 1949 and was the world's second longest-reigning monarch after the king of Thailand -- was hospitalised on March 7. He had been treated several times in recent years for heart and breathing difficulties.
His condition took a sudden turn for the worse nearly two weeks ago. On Thursday, the state's royal council decreed that Rainier was no longer in a position to "exercise his duties," and said that his only son Albert was taking over as regent.
English-speaking, Monaco-based Riviera Radio interrupted normal broadcasting to air classical music and broadcast tributes to the leader of the principality, which is smaller than New York's Central Park.
He will be remembered as a "builder prince" and for leaving a legacy of five decades of stability, the radio said.
The flag above the royal palace was already at half-mast because of the death of Pope John Paul II. The mood among the devoutly Catholic population of 32,000 had been sombre for several weeks as the two leaders approached the end of their lives.
Succeeding his grandfather Prince Louis II in November 1949, Rainier ascended to power three years before Queen Elizabeth II took the British throne. He was a descendant of the Genoese family of Grimaldi which had ruled the tiny Mediterranean port since 1297.
In his 55 years in power he is credited with transforming the microstate from a Riviera Ruritania into a thriving centre of tourism and banking, using his contacts and business acumen to diversify the economy and attract the interest of the rich and famous.
He also stoutly defended the rights of Monaco as an independent country, fending off attempts in the 1960s by France -- with which it is linked by treaty -- to curb its tax laws. In 1993 he brought the principality into the United Nations.
But the prince will always be best remembered for his fairytale marriage in 1956 to the American film star Grace Kelly.
It started with a courtship at the Cannes film festival, was celebrated before millions of television viewers in a magnificent ceremony in Monaco cathedral, produced three children, then ended in tragedy when Princess Grace died in a car crash in 1982. He never remarried.
Grace's glamour brought the Grimaldis into the media spotlight, and for much of his reign Rainier was troubled by the gossip surrounding their three children -- Caroline, Albert and Stephanie.
Caroline's divorce and the death of her second husband; Albert's succession of jet-set consorts but persistent refusal to marry; above all Stephanie's turbulent romantic life: the family's private lives were on constant display in the glossy magazines.
However Rainier himself retained his dignity, and there were no alarming revelations about his own private life.
Born on May 31, 1923, the son of Prince Pierre de Polignac and Princess Charlotte of Monaco, Rainier was educated in Britain, Switzerland and France, studying literature at Montpellier and politics in Paris.
In World War II he served with the French army and in 1945 received the Prix de Guerre for liaison duties under enemy fire.
When he took power in 1949 Monaco was a rich man's resort on the Cote d'Azur known for its casino and motor racing, but at risk of descending into lotus-eating idleness and total dependence on France.
Half a century later Monaco is the most densely-populated state in the UN, construction covers the whole of the territory and even areas reclaimed from the sea, and the country is on a sound economic footing.
France is a dominant presence -- by treaty the state's chief minister must be a French citizen and policy is aligned with that of Paris -- but in 2000 when French parliamentarians charged Monaco with being a haven for money-laundering Rainier saw off his accusers.
Rainier will be succeeded as prince by Albert, an accomplished sportsman and confirmed bachelor. In 2002 the state's constitution was changed so that the title can pass through the female line if Albert dies childless.