The Lib Dem peer will step down in the new year and will be honoured by her party with a reception on Thursday night.
Lady Williams, 85, was a Labour cabinet minister in the 1970s before becoming one of the gang of four who formed the Social Democratic party.
She became the first SDP member elected in a byelection in 1981 before losing her seat two years later. She was then president of the new party and supported its merger with the Liberals to form the Liberal Democrats.
Williams spent time as a politics professor at Harvard University, as well as lecturing at Cambridge, Princeton, Berkeley and Chicago.
She was appointed to the Lords in 1993, served as a leader of the Lib Dem peers and became an adviser on nuclear proliferation to Gordon Brown, when he was prime minister.
Ahead of her retirement reception, Tom McNally, the former leader of the Lib Dems in the Lords, said: “Throughout her life Shirley has made an outstanding contribution to the politics of this country.
“Her bravery, determination and commitment to her beliefs has benefited both parliamentary debate and public discourse for the last five decades.
“Shirley is a remarkable woman and it has been a huge privilege to work alongside her for all these years.”
This article was written by Rowena Mason Political correspondent, for theguardian.com on Thursday 17th December 2015 13.59 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010