Granddaughter of wartime prime minister; Born October 31, 1949; Died December 20, 2007. ARABELLA Spencer-Churchill, who has died aged 58, was the unconventional granddaughter of Britain's wartime prime minister and a founder of the famous Glastonbury festival.

Spencer-Churchill, who had pancreatic cancer, died at home in Glastonbury, Somerset on the same day that her son, Nicholas Jake Barton, was sentenced to three years in prison in Australia for his part in an ecstasy drug racket.

Spencer-Churchill was the daughter of Randolph Churchill, Winston Churchill's son, and June Osborne. She was a free spirit in one of Britain's grandest families, drawn to the hippy life. In the mid-1970s, she lived as a squatter in London, running a restaurant for fellow squatters.

"I'm immensely proud of my grandfather and hope he would be proud of me, but . . . I was no good at being a Churchill," she said in an interview published in June. "People never saw me for me. It doesn't do a lot for your confidence."

In 1971 Spencer-Churchill controversially declined an invitation to represent Britain at a Nato festival in the US. She wrote to the organisers: "My grandfather used the phrase The Iron Curtain.' It seems to be that what is facing us all now is the final curtain. The defence systems of the great powers are mutually infectious."

Her refusal caused a sensation in Britain, and in her family. She said: "My mother was saying, Darling, can't I just say you've had a nervous breakdown?' My brother (also Winston Churchill, a former MP) rang up, absolutely furious with me.

"The whole thing was a nightmare. I felt I had let the family down. I felt I wanted to be a hippy, I felt I was left-wing, I didn't feel like the rest of my family."

Spencer-Churchill was 21 when she first came to Glastonbury, a place associated with Arthurian lore and legend, and where she helped found the world-renowned festival in 1970. The following year featured Hawkwind, Traffic, David Bowie, Joan Baez and Fairport Convention, and attracted 12,000 people. She remained involved with the festival right through to this summer's event, which drew 153,000 fans.

"Her energy, vitality, and great sense of morality and social responsibility have given her a place in our festival history second to none," Glastonbury organiser Michael Eavis said in a message posted on the event's website.

Spencer-Churchill is survived by her husband, Ian McLeod, her son, and 19-year-old daughter, Jessica McLeod.