His career high came in the 1970s and included the anthemic Baker Street and Stuck in the Middle with You, recorded with his band Stealers Wheel.
Rafferty had battled a drink problem and spent time in hospital in Bournemouth with liver failure.
He was born in Paisley and began his musical career as a busker on the London Underground.Rafferty died peacefully at home, with his daughter Martha at his bedside.
It is understood his funeral will be held in Paisley later this month.
Rafferty had recorded and toured with Billy Connolly as part of the Humblebums, before forming Stealers Wheel with his friend Joe Egan in 1972.
Stuck in the Middle with You was a hit in the early 70s and also appeared on the soundtrack of Quentin Tarantino's debut film Reservoir Dogs in 1992.
Baker Street charted in the UK and US in 1978 after Rafferty began his solo career and still achieves airplay on radio stations around the world.
Gambaccini said: "He just wasn't of the constitution to deal with the music business, or to respect it.
"And thus he found fame and artistic success incompatible, and he became a wanderer, a lonely man, allegedly a drinker. And now we have this unhappy end."
Musician and BBC 6 Music presenter Tom Robinson said Rafferty would be greatly missed.
"I'm deeply saddened to hear that Gerry has lost the battle with his failing health," he said.
"His early work with Stealers Wheel was an inspiration to a whole generation of songwriters in the 70s, including me.
"Many of us had hoped his recent album Life Goes On in 2009 would lead to a full-time return to writing and performing for a lyrical and highly gifted artist."