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Ms Atherton won the marginal seat of Falmouth and Camborne at the 1997 general election beating Conservative Sebastian Coe.
She held the seat for eight years, doubling her majority in 2001, but losing her seat in 2005 to Liberal Democrat Julia Goldsworthy.
After her parliamentary career, she focused on rural housing issues.
More on this story and others from Cornwall
Candy Atherton returned to politics when she was elected to Cornwall Council in 2013, representing the Falmouth Smithwick division.
She also campaigned on women's rights and disability issues.
Labour deputy leader Tom Watson tweeted that he was "very sad to read that Candy Atherton has died."
Very sad to read that Candy Atherton has died. She was very kind to me when I was first elected. My thoughts and prayers are with her loved ones. https://t.co/a4X3sHDEsa
Boundary changes meant the Falmouth and Camborne constituency was abolished at the 2010 general election.
It was replaced by the seats of Camborne and Redruth and Truro and Falmouth.