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major fire at the old Thornycroft sheds on Platts Eyot, Hampton, on the River Thames.
The Little Ships Mary Irene and Elvin, which were also on site, were moved to safety.
Lady Gay was 34ft Motor Yacht built in 1934 for Lord Alfred Dunhill and cost £1,500 to build, reported the Association of Dunkirk Little Ships.
She was initially requisitioned by the Royal Navy under a net charter party arrangement for £6/month before she was finally acquired by the Navy in 1942 as a Thames and coastal patrol boat. The Royal Navy laid her up in 1944.
A cause of fire has yet to be established by fire fighters on the scene over the Bank Holiday Monday.
Historic boat that took part in Dunkirk Evacuation destroyed in Thames island fire
The fire ripped through the boatyard destroying almost everything in its path
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A historic boat that rescued troops during the World War II Dunkirk evacuation has been destroyed after a fire tore its way through a historic boatyard in South West London.