It has been confirmed that Shirley died peacefully at her home on Monday evening with her daughter Helena by her side.
The 74 year old had starred as Edna Birch in ITV's primetime soap for 15 years, since 2000.
John Whiston, ITV executive producer, said; 'The family here at Emmerdale are deeply saddened by Shirley's passing, it is hard to imagine Emmerdale without her.
'We offer our condolences to Shirley's family and share our feeling of loss with the millions of viewers who will miss Edna enormously.'
Edna Birch, who lived in Woodbine Cottage, was a character renowned for her iconic hats, which she was rarely seen without and were known to reflect her personality.
Ever since her first appearance over a decade ago, the factory worker had a vicious temper and was most closely devoted to her pet dogs.
Shirley is survived by her three children, Helena Edmundson, John Henderson and Mimi Henderson, and one grandson, Matthew.
The actress, originally from Cheshire, first trained at the prestigious Royal Academy of Dramatic Art in London before becoming a household name in a range of television and film appearances.
Her screen debut was at only 12 years old in David Lean's film Hobson's Choice.
In her later years, as well as being a regular in the Woolpack, Shirley starred as Melanie's mum, Jane Healy, in EastEnders and briefly in Casualty, The Bill and Coronation Street.
Shirley has starred opposite other legendary actors, including John Hurt in an adaptation of George Orwell's 1984 and with Julie Walters in Personal Services. She also appeared in Inspector Morse and Keeping Up Appearances.
Shirley was married to actor Don Henderson from 1979 till he passed away in 1997.