By Cristiano Corvino

MILAN (Reuters) -Supporters of former prime minister Silvio Berlusconi gathered outside his villa near Milan on a rainy Tuesday morning to honour the billionaire who dominated Italy's politics, business and soccer world for nearly three decades.

Berlusconi aged 86, three days after his readmission to the San Raffaele hospital in Milan, where he had spent a month and a half in April-May to treat a lung infection and a chronic form of leukaemia.

He was a highly divisive figure who set the mould for other businessmen-turned-politicians like former U.S. President Donald Trump.

Berlusconi was convicted of tax fraud in 2013 and temporarily banned from public office. He was tried and acquitted on appeal in the "bunga bunga" underage prostitution case.

Despite his increasingly frail health, his death came as a shock for the fans who came to pay tribute, leaving behind mementos including flowers, football scarves, political flags and a banner that read "Goodbye President".

"He leaves a big void inside me, as a man and as a politician. He was like family to me," said Luigi Russo, a lawyer who brought flowers to the entrance of Berlusconi's residence in the town of Arcore.

Italy is preparing a state funeral on Wednesday at Milan's cathedral, which is likely to attract tens of thousands of people. On Tuesday, only family and close friends were being admitted to a private wake inside Berlusconi's villa.

NATIONAL MOURNING

Meloni and President Sergio Mattarella are among those set to attend the funeral, which will take place on a national day of mourning, with flags flying at half-mast from all public buildings.

As well as being Italy's prime minister four times, Berlusconi owned a business empire including the MFE media group, and soccer clubs AC Milan from 1986-2017 and AC Monza from 2018.

"I feel sorry, I wanted to pay my respects to the president, the president of all of us, I am Italian and I want to say goodbye to him for the last time," Colomba Falduzza, a supporter who lives near Arcore, said.

No official cause of death was given, but Corriere, which broke the news of Berlusconi's passing, said he had died from leukaemia, with a sudden deterioration in his condition overnight into Monday.

Corriere said Berlusconi had been well enough to watch on television Saturday's Champions League soccer final between Inter Milan and Manchester City. Prime Minister Giorgia Meloni said in a TV interview on Monday that she had spoken "at length" with him that day.

According to analysts, Meloni's Brothers of Italy party stands to gain politically as Berlusconi's Forza Italia party risks imploding following the death of its founder and charismatic leader.

On Tuesday, Berlusconi was also commemorated at the European Parliament in Strasbourg, where, in one of his most infamous gaffes, he once told a German centre-left lawmaker that he reminded him of a concentration camp guard.

"History will assess (Berlusconi's) impact, but we are here today to mourn the man, a man who left a mark and who will not be forgotten," EU assembly president Roberta Metsola said as she opened a book of condolences.

(Writing by Angelo Amante and Alvise Armellini; editing by Ed Osmond)