Banks’ death was announced by his former club Stoke City early on Tuesday morning.
The cause of Banks’ death is currently unknown, though he is said to have ‘passed away peacefully.’
“It is with great sadness that we announce that Gordon passed away peacefully overnight,” a family statement read.
“We are devastated to lose him but we have so many happy memories and could not have been more proud of him.”
Last year, it was rumoured that the former Leicester man had passed away following a bout of cancer.
But that claim was emphatically dismissed by his family members on social media.
A slew of tributes for the former England international began to pour in online, including one from his old club Chesterfield.
“The sad news reaches us that legendary former Spireite Gordon Banks has passed away.
“Gordon, who started his career at Chesterfield, was of course part of England’s 1966 World Cup-winning team.
“Our thoughts are with Gordon’s family and friends.”
Leicester City, for whom Banks made 293 league appearances for, tweeted: “Leicester City Football Club is deeply saddened to learn of the death of our former goalkeeper Gordon Banks OBE, who has passed away at the age of 81.”
England’s official Twitter account wrote: “We’re deeply saddened to hear that Gordon Banks, our #WorldCup-winning goalkeeper, has passed away.
“Our thoughts are with Gordon’s friends, family and supporters at this difficult time.”
Banks began his career with Chesterfield in 1958 before joining Leicester City the following year.
He spent eight years with the Foxes before joining Stoke, who he made 250 appearances for.
After seven years with the Potters, he moved to America to play for Cleveland Stokers and Fort Lauderdale Strikers before ending his with St Patrick’s Athletic.
Banks won the World Cup England in 1966, but the most famous moment of his career came in the 1970 World Cup when he saved a towering header from Pele.