In 1987, Fay suffered a stroke that impacted her speech. She moved to the Motion Picture & Television Country House and Hospital in Woodland Hills, California, in 1989. In August 2001, her death was mistakenly reported in the obituary section of "The Daily Telegraph" in London. This reportedly happened when a nurse at the Motion Picture Hospital returned after a holiday to find her not in her room. When told that she had "gone," as she had, but only to another wing, the nurse promptly called one of Dorothy Fay's friends, who happened to be a regular contributor to the "Telegraph" obituaries desk. Fay and her family found the blunder amusing and took it in good sport.