The incident, which remains under investigation, occurred on Monday at 7pm in the Rosental, an assisted living residence for pensioners, police said in a press release.
The woman was sitting in a wheelchair smoking when her clothes caught fire for reasons not immediately known, according to the release.
She was seriously burned and died a few hours later after being transported to hospital in an ambulance, police said.
Meanwhile, an employee who attempted to put the fire out was also injured.
She was still in hospital being treated for “moderately severe” burns on Tuesday, police said.
Members of the Winterthur fire department, alerted by employees of the retirement home, arrived on the scene and extinguished the blaze.
The fire investigation service of the Zurich cantonal police force is investigating the cause of the conflagration.