She was drunk. She was foulmouthed. And somehow she had stumbled on to a live television programme among a group of art critics, all male.

“I wasn’t even aware I was on television,” says Tracey Emin, 18 years after a spectacular performance in a TV debate following the 1997 Turner Prize made her a celebrity. As Waldemar Januszczak and Roger Scruton tried to argue about conceptual art, Emin declared, among other nuggets: “Don’t you understand? I want to be free. Get this mic off.”

Today, as we sip tea in her Spitalfields studio, Emin claims she had no idea where she even was that night. She’d severely broken her finger and was on strong medication, which mixed badly with the booze at the Turner Prize dinner. “I just remembered that I’d been somewhere having a few drinks. I was pretty shocked the next day. I was in a greasy spoon having a hangover breakfast with Mat (Collishaw, the artist and her former boyfriend) and opened up The Guardian … ”

That was the launch into British national consciousness of Mad Tracey from Margate, a hard-drinking bohemian from the wrong side of the tracks who became at once a hate figure and sacred monster. When she exhibited her bed at the 1999 Turner Prize, littered with ashtrays and condoms, it was hard to even see as a work of art. It just seemed another stunt by Emin, as sensational and superficial as getting drunk on TV.

Anyway, that’s how it looked to me at the time. To Emin, it seemed her serious artistic ambitions were being mocked and she was touted as a freakshow.

“When I got nominated for the Turner Prize, I was asleep on the sofa. Mat woke me up and there was just a picture of my bottom on screen.“

It would be an understatement to say she’s having the last laugh. Earlier this month, My Bed, lent by Count Christian Duerckheim, who bought it for £2.54mil (RM13.8mil) at Christie’s last year, went back on view at Tate Britain. It has endured and lives on as the defining work of 1990s British art. Damien Hirst’s shark shrivelled and Rachel Whiteread’s House was demolished. When future generations want to know what was so different about British art at the end of the 20th century, it’s Emin’s bed they will look at.

That’s not all. “I’ve got this Vienna show coming up in a couple of days with Egon Schiele,” says Emin.

Schiele has been Emin’s hero since she was 15 and found out that David Bowie’s poses on the album covers for Lodger and Heroes are based on paintings by this intense and desperately beautiful Austrian artist, who died in 1918 at the age of 28. Now she is about to exhibit her own sensual paintings and drawings alongside his. “It’s like a dream come true …”

Tracey Emin is growing into an old mistress, even a national treasure, enshrined at the Tate, pushing into the pantheon with the great (male) artists of the past. I say “old” because she keeps describing herself that way. Showing me a huge pink near-abstract nude painting of herself – it is very powerful – she says she originally wrote the word “old” on it. People said it wasn’t true, so she removed it. But she regrets doing so. All the drawings and paintings of her having sex that dominate the studio and are at the heart of her current work are, she explains, memories of a time that’s gone: resurrections of a vanished fire. No wonder they are so haunting. “I haven’t had sex for five years. More. It’s something gone. It’s like a memory or something,” she says. “It’s trying to remember what things were like.”

Why has Emin, of all unlikely people, emerged as one of the most genuinely respected artists of her generation? There are very obvious reasons why the artist who seemed to be drinking herself to hell has lasted the course while contemporaries including Hirst have made fools of themselves and lost all credibility.

One is that, as her generation gets older and tires of producing fabricated readymades, Emin actually has the skill to do something else. Her readymades were always hand-made anyway – from her tent with the names of everyone she ever slept with stitched into it, to rickety wooden fairground structures recalling her seaside childhood.

Behind this cascade of conceptualism, she’s a trained figurative artist who studied painting at the Royal College of Art.

“I hated it but learned a lot about painting,” she says. So when Emin draws and daubs, it has a lot more force than when Hirst tries to prove himself as a painter. “Damien didn’t study painting … He’s too young for the comeback tour. He should have had his show at Tate Modern in 10 years.”

Emin loves tactile, physical art. She shows me a cute little sculpture of her cat that was her first effort at bronze casting, a whole new skill she’s been learning. No, she says, she did not call in some fabricators as others of her generation have done. She’s feeling her way in bronze for herself.

“Cake making – never going to happen. I’d love to learn the guitar, but it’s never going to happen. But I am learning to make bronzes. When I went to the Tate and saw the Henry Moore there, it’s so brilliant. Bronze casting is like Plato’s road to Larissa: no one can teach you, you have to find it yourself.”

Emin is steeped in serious modern art. She wants to compare notes on the new Picasso museum in Paris. She talks about Francis Bacon and comes back to Schiele. She has a provocative theory about him: “One thing that really interests me about Schiele is that his drawings are so obviously traced from photographs. The foreshortening is perfect. It would never be perfect. Even Picasso’s isn’t perfect.”

NEXT PAGE: So who is perfect, Tracey?