She passed away at her home in New York after a long illness, one of her daughters told the The Associated Press.
During a career that spanned more than 40 years in the film industry, Jhabvala wrote more than 20 screenplays for Merchant Ivory productions. In addition to her Oscar wins, she was nominated for an Academy Award for her adaptation of Remains of the Day.
Born in Cologne, Germany, to Jewish parents, Jhabvala emigrated to Britain with her family in 1939 to escape the Nazi regime. (Her father later committed suicide after learning that 40 of his family members had died in the Holocaust.) She became a British citizen in 1948, and got her masters in English Literature from Queen Mary College in 1951.
Jhabvala lived in India in the 1950s and began writing novels and short stories, many of which appeared in The New Yorker. In 1975, she received the Booker Prize, Britain's highest literary award, for her novel Heat and Dust. Her final published short story appeared in the March 25 issue of The New Yorker.
She is survived by her husband Cyrus, three daughters, and six grandchildren.