It has been some 20 years since Vivienne Westwood told a television audience that they ought to know better than to laugh at her clothes.

The occasion was "that Wogan interview" - the show was in fact hosted at the time by Sue Lawley - and Westwood was openly hurt and confused by such an unsympathetic response.

With the opening of her first major retrospective at the Victoria & Albert Museum in London last night, the erstwhile queen of punk and grande dame of British fashion finally had the last laugh. With a pair of gleaming silver horns peeping through her apricot hair, Westwood, who turns 63 next week, positively radiated pride. As well she might do. She's been in business for 34 years and only a fool would today question the impact she has made on international fashion.

The uniform of punk, the New Romantic movement, buffalo, the reinvention of the corset and the mini-crini. Gathered together here in one space, all are testimony to a wealth of ideas that remains unrivalled. More surprising still, Westwood's finest moments seem just as relevant now as they did way back when.

The show has been brilliantly edited, largely by the designer herself, who claimed to have been taken by surprise by her own work as she put the finishing touches to mannequins earlier this week. "I'm not terribly interested in my own past," Westwood said as she posed for the cameras, "but for the past few days I've been helping to install this and I've fallen in love with these things over and over again."

Viewers are met by a blown-up portrait of the designer in her teens: a young, fresh-faced northern girl - she was born in Glossop in Derbyshire - grinning cheekily in headscarf and tweed. To one side is the famous clock that hung outside her World's End store telling devotees the time throughout the Eighties - backwards. "I have a sort of built-in clock which always reacts against anything orthodox," the Westwood quote printed alongside it reads.

And this, perhaps, is her greatest accolade. Although Vivienne Westwood OBE has spent much of her career railing against the establishment - she once famously twirled knickerless outside Buckingham Palace for the paparazzi - there is no way it can ignore her any longer. Instead, she has become a Great British Institution. She put it neatly. "I've known from the beginning that time is on my side. It's all about stamina, really."

And about the clothes, many of which still have immense power. Here is the Seditionaries T-shirt printed with the words "No future" or "Only anarchists are pretty". There are the famous blue rocking-horse platforms that felled a young Naomi Campbell in 1993. The tweed crown and ermine wrap that demonstrate Westwood's ongoing obsession with the British Royal Family is still the most witty take on that particular subject the world is ever likely to see.

Claire Wilcox, curator of the exhibition and author of the book published by the museum to coincide with it, said: "Vivienne Westwood encapsulates a particular kind of Britishness, combining fearless non-conformity with a sense of tradition." She pointed out that the relationship between the two sides stretches back many years: Westwood has studied the Victoria & Albert Museum archive minutely and at least some of the original pieces that have inspired her are displayed here.

For its part, the museum bought its first piece of Westwood from the Pirates collection in 1983 and has been adding to it ever since.

Despite the grandeur of the proceedings, Westwood insisted, as always, that "fashion wasn't my first love. I didn't want to do it." It's by now the stuff of fashion legend that her former partner, Malcolm McLaren, persuaded her otherwise. She did concede, however, that it had been a good move. "People say my clothes are about sex but, at the end of the day, they are always heroic, they're larger than life," she said.

From the bondage trousers originally worn by John Lydon and the huge layered skirts from Nostalgia Of Mud, her first show in Paris, and from "Statue of Liberty" corsets to the overblown ballgowns that have come to represent her more recent work they are all, most certainly, that.