Nell Dunn: I never used to think about death, until I was 50. I was never going to die. I was immortal. But now I think about death every day

She's done the working class, in Up the Junction. She's done women, in Steaming. She's done novels – eight of them. She's done the fashionable literary circuit, where she has been a celebrity for the best part of three decades. Now, she's done, even, writing. Nell Dunn's latest – and possibly last – venture is a play of which she hasn't written a line. Cancer Tales is based of the experiences of five different cancer patients and their families.

"It's a completely new departure for me," says the novelist and playwright. "Not a word of what the people I talked to said has been changed at all. I am merely a midwife."

Still fresh and beautiful at 66, with bobbed ash-white hair and clear amused eyes, and dressed in a striking cranberry-coloured velvet affair that is neither dressing-gown nor evening dress, Nell Dunn has an enthusiastically girlish voice and laugh. She may be unrecognisable as the full-lipped, curly-haired blonde whom Augustus John drew when she was a girl – the drawing hangs in her Fulham kitchen – but she is still glamorous, one of life's enhancers.

Cancer Tales has not, as yet, had much of an airing. It was shown last night at the Greenwood Theatre in London and has been performed for Macmillan Nurses at a conference. It is also being published, by Amber Lane Press. But never mind the fact that, unlike her previous work, it has not been made into a feature film or a television play – Nell would simply like someone to give money to make it into a video so that she could give it to medical schools and nursing colleges.

Nell Dunn has always been associated with the unfortunate and the underprivileged. ("Well, actually I have done books about the middle class," she confides. "But they've never sold very well. People seem to prefer my working-class stuff.") Yet her background can only be described as outrageously posh. Her mother was the daughter of the 5th Earl of Rosslyn – the man who broke the bank at Monte Carlo. True, he did go bankrupt afterwards and was forced to earn a living on the stage, but this connection still makes Nell a descendant of Charles II and Nell Gwyn. Her father, Sir Philip Dunn, was a gentleman farmer.

But though her upbringing was grand, it was still, Nell insists, bohemian. For instance, Nell's father didn't believe that his daughters needed any qualifications, and as a result Nell has never passed an exam in her life. She only learnt to read at nine years old and "whenever my father saw my appalling spelling, he would laugh. But it wasn't an unkind laugh. In his laugh there was the message, 'You are a completely original person, and everything you do has your own mark on it.' He wanted us all to be unique," she says.

To be unique, and to seek pleasure – these were his two aspirations for his children. "You dressed for pleasure, you ate for pleasure. What has stayed with me is the knowledge that pleasure exists and that it is absolutely the thing to aim for." Pleasure, for Nell, came in the form of writing. She wrote her first play when she was at a convent, at 13. "I remember the feeling of excitement and I wanted to be a writer. I still find writing the most interesting thing to do." But it wasn't until after she was married that she started writing professionally.

At 17, she met old Etonian Jeremy Sandford, an early "green" person. They married when she was 20, and moved to Cheyne Walk, a grand family home opposite the river in Chelsea, but "I hated Cheyne Walk, it was horrible to live with just the river opposite, it wasn't contained. It wasn't a talking street." So, in 1958, she moved across the river to a little cottage that she found for £700 in Battersea. This was not so much a talking street as a jabbering street. Here she found people chatting endlessly – on the doorsteps, on the pavements, over the garden fences; a woman from across the road popped in immediately she moved in to point everything out to her – and Nell was so captivated she took a job in a sweet factory, packing liqueur chocolates. "I felt immediately at home. I wasn't lonely any more."

And she started to write. Her first success was with Up the Junction (1963), a book that was later turned into a Wednesday Play on television featuring Carol White, which described the lives of Battersea women. Not only did it reveal the lives of the working class in a way that hadn't been done since Dickens and Orwell, but, even more important, it was about working-class women, who had, until then, been completely ignored.

This was followed up by the book Poor Cow (1967), set in Fulham and Catford, a grisly area of London off the South Circular Road. The same year, it was made into a film, directed by Ken Loach, with Carol White and Terence Stamp. This again was about another free-spirited working-class girl and her attempts to make a life for herself and her young son, Jonny.

By then Nell and her husband had moved to a house in Putney. He was writing Cathy Come Home for television, highlighting the plight of the homeless in London, and, with their three children, they were a glamorous, revolutionary and golden couple – celebrated in the media and fêted by the literati. I remember being taken to visit them as a shy teenager in the Sixties, by an advertising man who, like everyone in those days, was captivated by the romance of the working class and who sprinkled his conversation with words and phrases that Nell had made new – such as "birds" and "wotcher me old cock". I was terrified by the glittering couple and their bohemian house. "How funny," said Nell. "It's conventionality that I find far more terrifying."

It would be easy to think of her as breaking away from some formal crusty upper-class family life, and searching for la nostalgie de la boue. But it wasn't, she insists, like that at all. She says her parents were always fascinated by the working class and not at all stuffy. "As a writer, what I do admire about the working class," f she says, "is their use of language, I like the narrative quality they have of talking about their lives, the story-telling and their humour. I'm tremendously influenced by Carry On films which I find terribly, terribly funny."

But she wasn't driven to write about her life across the river only out of a sense of fascination with language. What really got to her was what she calls the "aching poverty, really aching poverty" of the working class in the Sixties. "I do think it was appalling what happened in the Sixties. A lot of the quality of working-class lives was completely destroyed by the planners. They pulled down all these lovely Battersea cottages, where people had chickens, and dogs, and rabbits and pigeons and gardens, and put up these badly made estates."

It was Nell's interest in the women of the working class that made her work truly radical, something that was never more clearly in evidence than in her play, Steaming (1980) – which in 1985 was made into a film featuring Vanessa Redgrave, Sarah Miles and Diana Dors. Six women, of varying backgrounds, lie in a Turkish bath, chatting about life, sex, and how ghastly men are, and link together to protest against the closure of their precious baths.

"My mother wasn't a grande dame or a typical wife in any way, so I didn't have a lot of experience of being crushed as a woman," says Nell. "She became a farmer when my father was away in the war, running a farm on the Bucks/Beds borders. The writer Frances Donaldson was farming alongside her at that time, in similar circumstances, and they were really happy. My mother drove a tractor, had Land Girls and she used to have a right old knees-up with them. She was only 23 or so, a real trailblazer, never out of jeans and a sweater, with hair down to her shoulders."

Dunn says that she understands women better than men and that that is what drives her to write about them. "I like the way women run a marvellous kind of Mafia where information circulates instead of heroin or gold. No, I wouldn't go as far as saying I like them better than men – that's going too far. Men are rather baffling, don't you think? It's a huge generalisation, but they don't seem to want you to get to know them as women do. But this can, of course, make them rather restful to be with."

Although her marriage to Jeremy Sandford broke up at the end of the Sixties, Nell has found another man to be restful with for the past 30 years – and about whom she is extremely discreet. He lives round the corner in the Fulham Road: it seems it's impossible for her to live with anyone, because in order to write she needs to be completely solitary.

Solitary can mean lonely, however, and that was why she found it so stimulating, with Cancer Tales, to discover the director Trevor Walker, with whom she workshopped the piece at Goldsmith's College. "It was such an interesting experience working with him, such an exciting thing for me to go through the writing of a play with someone else. I've never done that before. I had an instinctive feeling that that was what I wanted to do. It could have been a disaster, but it wasn't. Far from it."

Every day, Nell gets up at about 6am and walks her dogs for an hour. Landscape is very important to her. She then works in longhand – "I like the quiet of longhand" – before putting the words into a computer; and only then is the anxiety that besets her life somewhat relieved. "A lot of my life has been swathed in a thick fog of free-floating anxiety. I can't bear the idea of not being in control. That's why I worry about getting older. I worry about not being in charge of my own life, being too feeble, being a nuisance."

After working, she feels free and light. "I've always been a sidestream writer, never mainstream. I like to explore the waterweed, or look at an old duck. I'm quite like a painter and interested in portraiture. People in moments of crisis are more vivid and part of my impetus in writing has been a huge caught-upness about people. Steaming was based on real people but I always flipped them over and took them further. Dawn, who painted her nipples red and ran around the room, Josie with her fantasy about the man in the white suit – they never really did this – it was me taking them further. But in Cancer Tales the people speak for themselves. No showing off."

Cancer Tales was prompted by her father's death from cancer 25 years ago – a "pretty appalling experience" worsened by failures of communication. "They – the doctors – didn't talk about it. And we didn't talk about it. I spoke to no one. My lips were sealed. It was a case of: 'Don't come here for help – nobody home.' I didn't know what it was for one person to support another through a crisis. I didn't know how to help those numb feelings of no man's land. In those days there wasn't a language to talk about anything bad that was happening, and it's still difficult to talk about painful things. It was sad we couldn't discuss it. So with Cancer Tales I had many long conversations with doctors and nurses and ordinary people in the front line who told me what it was like and I wrote it all down.

"I also wrote Cancer Tales because I'm getting older and I knew I had to die and I didn't feel familiar with death. I never thought about death till I was 50 – I was never going to die, I was immortal. But now I think about death every day. And I wanted to know more about it. I didn't want it to be a mystery. I wanted it to be ordinary. And writing about it has helped."

Will she write something else now? At present, she says, she is simply open to what happens to come along. "I don't have any ambitions right now. I don't want to move – what's the point? I'd simply be stuck with me. And a bit of me thinks I could spend my life happily sitting on my sofa, reading books, talking to my neighbours and seeing my grandchildren."

Meanwhile, mortality continues to occupy her thoughts. Three weeks ago, Nell's 15-year-old Jack Russell, Ivy, was put to sleep. "I absolutely adored her," she says. "She was my right-hand woman. She had a wonderful death. She knew the vet quite well as he'd operated on both her legs. I carried her in to the surgery and instead of just getting his syringe and putting her to sleep he said to come back after hours. When we arrived, he stroked her and said: 'Hello Ivy, I know you very well, I've done both your legs, you look very tired, don't you?' and he just took his time.

"I was kissing her and stroking her and he said: 'This isn't going to be painful at all. She won't feel a thing.' He just put a syringe in her leg, and she went a tiny bit limp and he got out his stethoscope and listened to her heart and said, 'She is dead now,' and I was kissing her, and I put her blanket under her and he helped me wrap her up. It was all so beautiful and carefully and lovingly done and it was such a positive experience. It felt as if she was acknowledged, which she was." Nell's partner was there, too, and "it felt as if I could die that way. You know, with love and dignity and acknowledgement ...

"We had her cremated and put her ashes in a dear little cardboard box and we buried them under a 12ft oak tree we bought in Richmond Park for £30 when it was then a darling little sapling, and we're all going to have our ashes under it, including our other dog. It is really very nice having her ashes just under the tree. I walk past her every day.

"Curiously enough, writing Cancer Tales, and having these beloved animals and beloved friends die makes death so much less frightening. I know their spirits are flying around there and it doesn't feel so lonely."