Mrs Thatcher warned her successor as PM that he was on the verge of making an "historic error" about interest rates.
She was also angry about his plans to abandon one of her signature policies, the poll tax.
Conservative Mrs Thatcher, who was prime minister between 1979 and 1990, had previously made clear Mr Major, who went on to serve as prime minister until 1997, had been her chosen successor.
During the meeting, which took place in Mr Major's room in the House of Commons on 3 January 1991, Mrs Thatcher warned that "excessively high" interest rates risked pushing the UK's economy into recession.
She compared the position to Winston Churchill's decision as chancellor in 1925 to fix the parity of the pound at a high level. This led to deflation, mass unemployment and the General Strike.
