Joanne Kathleen Rowling is a down-to-earth kind of woman - considering she's a multi-millionaire writer. Her own daughter comes first, of course, even if they do have a boy-wizard in the family. By Simon Hattenstone

I've just been mobbed in the playground, buried in a froth of 10-year-old girls. I'd barely whispered that I was going to see JK Rowling, and that was enough. Can you get me her autograph? Will you find out the name of the new book? Ask her who dies? Who gets to snog Harry?

No one asks what the JK stands for, how old she is, whether she's married, got children. They know - Joanne Kathleen, 34, married, separated, single mum, six-year-old daughter Jessica, Jessie to us.

I walk away shellshocked. One of the dads rushes after me. "You're very lucky," he says. "She doesn't often give interviews, a bit of a recluse. It all got to her, I hear, went a bit Harry potty."

The grown-ups are almost as excitable as the children. A friend tells me that the books are really adult fare masquerading as kiddy lit. Look out for the leitmotif, he says - estrangement and loss. His wife calls him in for tea, and says he has always had a thing about boarding schools.

Harry Potter And The Philosopher's Stone was published in 1997. There were news stories about it at the time because Rowling had received an advance of more than $100,000 in the US. The first three in the series of seven have now sold more than 35 million copies. The fourth book has achieved advanced sales of two million. Last year, Rowling earned £14.5 million, making her Britain's third-best-paid woman, well ahead of the Spice Girls. And so the figures and hyperbole roll on.

We've arranged to meet in a hotel in Edinburgh. She doesn't allow journalists into her house; her daughter has always been kept away from the press. The hotel is camouflaged as a town house. No name on the outside, just a number. It's musty and forbidding, and reminds me of the invisible entry to Platform 9 3/4, from where Harry and his fellow student wizards take the train to the magic school of Hogwarts. The Harry Potter books are well-crafted slices of nostalgia. Nostalgia for a world that few contemporary children would know about. Boarding school, house points, a girlie swot, an insipid hero, a slightly naughty best friend: this could be the Famous Five or Billy Bunter or Just William. Her publicist leads me to the JK Rowling suite. She is sitting there ablaze - all strawberry-blonde hair, red velvet jacket and cigarette smoke. She'd make an attractive, down-to-earth witch in this grandiose setting.

She used to teach French in a Scottish comprehensive. She says that what attracted her to planet Potter was its "controlled anarchy", and she takes me back to her classroom experience. She doesn't think she was a bad teacher, but she does think she had bad thoughts. Sometimes, she'd face the children so aware of their strength and her vulnerability. "I remember standing in front of the most difficult class I taught, and things were going fine. I don't know why - maybe it's my personality - but I was standing, leaning against the desk, waiting for the next person to say, 'What am I supposed to do?' and I thought, 'They can have me. What's this invisible thing stopping them?'"

They used to take the mickey out of her, mock her English accent. But they were never sure whether to do her as a cockney or a Hooray Henry, so she taught them how to do Forest-of-Dean.

I tell her how, at my school, we drove our French teacher to a breakdown by sticking pins on her chair. She laughs, loudly, and I begin to feel guilty 25 years too late. "That's nice of you- hahaha!" She laughs like a Gatling gun - it's the loudest laugh I've ever heard. Suddenly it stops and she's speaking in a hush. "Did she cry in class?" I nod. "See, that's bad. I never cried, I felt like it, but I never did." Rowling is one of life's copers.

Her heroine is the writer Jessica Mitford. She remembers going to visit her great aunt Ivy in Somerset when she was 14, and being told about this amazing woman. "And she said, 'You know what she did, Jo, she bought a camera on her father's account and then went travelling.'" Young Joanne thought that was wonderful. Later, she discovered that Mitford was also a civil-rights activist who had suffered more than her share of tragedy. "She had a total lack of self-pity. And she lost three children through war, which is the worst thing that could happen."

After university, Rowling worked for the human-rights organisation Amnesty International. She still knew she wanted to write, but this was the next best option - "a day job that I cared about". She chews heavily on a cigarette before telling me how she loused up her life. Like Mitford, she left England to travel. She ended up teaching English as a foreign language in Portugal, where she fell in love with Jorge Arantes, married him, had a child, began writing Harry Potter, and fell out of love. When she told Jorge how she felt, he threw her out. She returned the next day with the police, collected Jessica, and headed back to Britain and the most dismal phase of her life. She had no money, no job, nowhere to live. "Pretty much everything was gone." She also feared being dragged back to Portugal to fight a custody case.

She considered moving to London, where many of her friends lived. But they were single, childless and carefree. London wasn't the right place for a woman with worries. So the girl, born in Chepstow, raised in the Forest of Dean, headed for Edinburgh, where her sister lived. "I knew two or three people, and I was incredibly lonely. I was really angry." Did she resent having Jessica? "No, never. I was very angry at myself." Why? "I don't know. I never expected to find myself in that situation, and I was furious with myself. But I certainly never regretted leaving, and I never ever for a second regretted Jessica. She kept me going."

It's not that she was particularly ambitious for herself, or that she had mapped out her life. "I just never expected to mess up so badly that I would find myself in an unheated, mouse-infested flat, looking after my daughter. And I was angry because I felt I was letting her down."

One day she visited her sister's friend and realised she'd hit rock bottom. "She'd had a baby just a couple of months before me, and I saw Thomas's bedroom full of toys, and at that point, when I packed Jessica's toys away, they fitted into a shoe box, literally. I came home and cried my eyes out." But within six months, Rowling had found herself a typing job. She then took a postgraduate certificate in education. A year later, she was teaching French, and Harry Potter And The Philosopher's Stone had a publisher. Her first royalty check was for £600. Another year on, she was a millionaire and had given up teaching. It all sounds terribly neat, but of course it wasn't.

When she left her teaching job, it was not because fame beckoned, it was because her contract had run out. "The senior teacher in the department was very worried about me. I said I'd do supply teaching, and she said, 'Are you going to be all right?' And I said, 'Well, it's not all doom and gloom - I'm having a book published!' She said, 'No way! ' It wasn't that we both then thought this will set you up; it was just something you've done that's good."

For years, Joanne Rowling was a closet writer. Her sister knew she was writing, her estranged husband knew, her oldest friend (to whom the second book is dedicated, and the template for Harry's friend Ron) knew. But that was about it. She once told another friend she was writing a novel, and the friend blanked her. "I think she thought I was deluding myself, that I was in a nasty situation and had sat down one day and thought, I know, I'll write a novel . She probably thought it was a get-rich-quick scheme."

For two hours every week, she'd leave Jessica with a friend and sneak off to a cafe to write. She has never had much time for fantasy, certainly isn't a buff. "I've read The Hobbitt, and I read CS Lewis when I was about eight. But I don't like fantasy as a genre. Today, people seem to think if there's a unicorn in a book I will love it, and they give me the books..." Invariably, they are wrong. She would much rather sit down with a good Roddy Doyle. She may have studied classics, but her frame of reference tends to be populist - Q Magazine, Father Ted, The Royle Family. What she seems to enjoy about Harry's universe is that it is her creation, ruled by her own logic. Whereas many of us may not have a clue whether Harry is exceeding his powers, she knows exactly what he can and can't do. She gets quite exercised if people tell her they think Harry's dead parents are going to come back to life at the end of book seven. "We've had petrified people, and we've had what would have been fatal injuries, but once you're dead you're dead. No magic power can resurrect a truly dead person."

One of her pupils eventually discovered she was writing a book. The girl had turned up without pen or paper; Rowling gave her the obligatory telling off and sent her to get some from the notepad on her desk. "She was ages at the desk, and I turned round and said, 'Maggie will you come back and sit down,' and she went (putting on a Jean Brodie voice) 'Miss, are you a writer?'" Rowling felt embarrassed, exposed. "I think I said, 'No it's just a hobby.'"

Rowling is stridently unpretentious. She admits hers is a remarkable story, but not nearly as remarkable as the newspapers would have you believe. Always simplify, always exaggerate, she says - the golden rules. So the two-bedroom flat became a bedsit; the papers conveniently fail to mention that she was from a middle-class family, that she had a degree in French and classics. They much preferred to caricature her as the penniless single mother/divorcee.

"I detected a tone of 'Ah, lone parent', as if by definition, if you found yourself in that situation, you must be a real under-achiever, which is so the reverse of the case, because I know lone parents and, without exception, they are people doing paid work, and the work of two parents, and really working so damned hard." She says she needed more help, but her health visitor told her it wasn't available because she was coping too well. "I know it's right that it would be kids at risk who get priority, but it does mean a lot of people, the majority, are in my situation where they are coping, but just a tiny bit of help would mean that life was so much better for the child."

She asks if I remember the speech John Major made about society's ills being down to single mothers. She had just been back in Britain a couple of months, and now every time she hears Major described as a decent man she blanches. She says people exploit her story, depending on which way the political wind is blowing. "There is the sense of 'Oooh, what a miracle!' as if it's superhuman for single parents to achieve anything. But then I've occasionally detected a 'Well, they can do it if they have to', which is equally unfair." She says she was able to succeed because all she needed was pen and paper, and then some way down the line a typewriter. If she'd wanted to be a fashioner designer or fine artist, she reckons she would have been stuffed.

"Penniless single mother," she repeats. "The doleful tone of those words." At least, she says, when they call her a penniless divorcee it has attitude. "The blowsy woman up at a bar, 'and then when Charlie left me...' " Rowling's a cracking mimic.

She enjoyed the second stage of success most. This was just before the release of the third book, Harry Potter And The Prisoner Of Azkaban. At this point, she was allowed to merge into the background as writers began to analyse the appeal of Potter. "I never wanted the focus to be me. The vast majority of writers do not aspire to publicity. I'm sure there are a few... Jeffrey Archer, but then again he's not a writer, is he?" Oooh! "Oh come on, you know what I'm saying. There's a certain kind of fiction where publicity is crucial, but for the great majority of writers that's not what you're in it for, are you?"

It's a good question. Rowling may not be in it for the publicity, but her publisher, Bloomsbury, certainly is. The more the books have sold, the more the media has wanted of Rowling. And when she declined their interest, they decided she had become a recluse. A while ago, her ex sold his story. Rowling didn't react, though it obviously upset her. "It is never a nice feeling." But he was nice about her, said how much he wanted her back and sod the money? "Nice isn't really the word. Nice or horrible isn't the issue. It's just his version of our marriage," she says. Then there was the time that Raymond Briggs criticised the books, and the papers were banging on her door demanding a defence. Then she didn't win the Whitbread, and they were back for another comment. Now another controversy looms- Rowling has just failed to win the Carnegie prize for children's literature.

"Phase three has been, 'She's cracking up, she's become reclusive.' If I'd not given an interview for longer than a month, they wanted to know why." In many ways, Harry Potter has enabled her to take control of her life; but he has also brought intrusions. She says it's funny how strangers feel confident that they know exactly why she wrote the books. "I'm often informed that I wrote the first book as escapism, because my life was so horrible. Well, that's just not true. When I started writing the books, I was working, in a very happy relationship, life was fine, no one had died. Everything was okay."

I ask her what is the most extravagant thing she has done with all her millions. She says it came at a time when she was struggling with the plot to book four, just after Jorge's story of their marriage was published. She was sitting in her favourite writing cafe, had been there two hours, and the paper was blank with self-pity. "I was just feeling very down, and really worried about the book, and then I thought there is an upside to this situation and I walked into this jeweller's and I dropped a lot of money on a very expensive ring that I'd seen the previous week. And you know when you spend more money than you plan to, everything else looks cheap by comparison - so then I bought presents for my two best female friends as well. And I have to say it helped."

Where's the ring now? "At home." What's it like? "Obscene. But that was the point. It's a big square cut stone, aquamarine. You can't type with it on because it's so heavy. It's one of those things you have to bring out on certain occasions; it's not day-to-day because you could really hurt someone with it." Rowling considers the ring such an extravagance because there was no justification for it. She recently bought a nice home, but doesn't regard that as extravagant because it will make life more comfortable for Jessica.

Rowling, Jessica and Harry. It makes for an intimate family. And when she talks about Harry, how anxious she was that a Hollywood studio didn't come along and ruin him, how he's reaching puberty and about to discover girls, she does sound like a doting mother. She says she is possessive of him. What's the worst thing anyone could do to him? She mishears me. "I can do to him whatever I like. I'm allowed to torture him as much as I want. He's mine."

Does Jessica get jealous of Harry? "Oh no, she knows, and she's right, that she's top dog. She's got a healthy ego, in the best way." Initially, Rowling told Jessica she wouldn't read her the books until she was seven. But when she started school, the older kids would quiz her about Harry and she was in no position to answer. "It happened so often that, in the end, words had to be dropped - would they please leave her alone so she could play with her friends." When Jessica began to go behind her mother's back, asking other people what happened in Harry Potter, she decided it was unfair to keep her away from the books any longer. "I was more nervous reading to her than anybody." Why? "What if she'd turned round and said this is rubbish, I want to go and play with everyone - hahahaha! I would have been okay with it, but it would have been difficult because if her tea was half-an-hour late, and I'm going, 'In a minute, in a minute, I've just got to finish this.' It's probably easier for her to take if she thinks she'll like the end-result." Just as she won't tell anyone else about the plot of the new book, she won't tell Jessica. A secret's a secret.

Considering Rowling's own life, it seems surprising that Harry's world is so traditional, so removed from the biting realities of single parents and the dole. It's a very conservative world, I say. She takes a deep, uneasy breath. "So I'm told repeatedly. The two groups of people who are constantly thanking me are wiccans (white witches) and boarding schools. And really, don't thank me. I'm not with either of them. New ageism leaves me completely cold, and Jessie would never go to boarding school. I went to a comprehensive." Did she ever want to be part of that world? No, she says, the first time she met anyone who'd been to boarding school was at university. "I thought it sounded horrible. Not because I was so attached to home - I couldn't wait to leave home - just that the culture was not one I'd enjoy. It staggers me to meet people who want to send their kids away."

She has become edgy. "I do get kind of frustrated with this conservative world thing because..." She explains at length, and somewhat defensively, that the school had to be a boarding school because most of the magic happens in the middle of the night, and if it was a day school you wouldn't get the same sense of community. She also argues that, in a way, Harry does reflect the modern world because he is mixed race - his dad being a wizard, his mum being a muggle (human) witch - which seems to be pushing it a bit.

This is about the only claim Rowling does make for her Potter books. She never suggests they stand up as modern classics. She's a pragmatist: she knows bestsellers are rarely great literature. When I say they are well-written, she seems delighted and tells me how at times she rewrites obsessively.

What limits the books for me is their lack of emotional and psychological depth. One of the few moving, and surprising, moments occurs in the first book, when Harry stares into a magic mirror... and sees his dead parents. He later learns that the mirror offers a reflection of what he most wants in life. Rowling says this is a rare autobiographical element in the novels. "The mirror is almost painfully from my own feelings about my mother's death. She died when I was 25, so I was six months into writing the book when she died. And she was 45." She says if she were looking in the mirror she would see exactly what Harry saw. People search pointlessly for other aspects of her life in the books. As she says, they are works of imagination.

At times when Rowling is talking about her success, she seems shaky, suspicious of it. Of course, she loves having money, she says, but maybe she wishes she'd been just a little less successful. She worries about the amount of money, and she also worries about talking about the fact that it worries her. "Yes, I'm riddled with guilt. It's a very weird situation. Then again, there is a solution... you can give it away. You can't sit there and say, 'Ah, it's tragic, I've got a lot of money', because nobody's stopping you spreading it about a bit." And is she doing so? "A bit," she says tersely. At least, she says, it doesn't feel like dirty money.

I ask Rowling if something such as this can happen without it changing you. She takes an age to answer. You sense she'd love to say, no, of course it doesn't alter a thing, but it wouldn't be true. "No, I don't think it is possible, honestly." She admits that it has become harder to trust the motives of people, and at the same time others are wary of her. She mentions a good friend she made in the schoolyard. The woman didn't know she'd written the Harry Potter books. "She said to me if I'd known who you were I'd never have spoken to you. I said, 'Oh, cheers!' She then said, 'I would have thought that you would have thought that I only wanted to speak to you because...' I laughed. She was very funny about it. So when we met in a normal, bog-standard situation we became very friendly. It's perfectly possible..." Suddenly, she seems a little self-conscious. "You know there are a lot of people who don't know about Harry Potter, millions of people who don't have a clue. I'm not Mick Jagger!"

Rowling still insists that the seventh Harry Potter will be the last. Will she miss Harry? She says she's not looking forward to finishing, but there will be some comforts in it. Less demand for photographs, for one. "If I can honestly say to myself that, at the end of book seven, I wrote the story that I set out to write, and didn't change one tiny thing because some reviewer had said, 'Let's have more feisty female footballers '; if I can look myself in the mirror and say I did it the way I wanted, then I'm okay with it."

She would like to try her hand at adult fiction, and has a filing cabinet full of notes. "Yes, I'll still write. But I really mean this, I think it's quite possible that I'll finish Harry and go to the filing cabinet where the notes are and think they're rubbish."

I follow her downstairs to where she's having her picture taken. The photographer asks if she minds having a picture taken with a broom that he's bought. She winces, and obliges. "Let's be honest, I feel a twat about this, let's be straight," she says through another Gatling gun laugh - before, true to form, she turns herself into a resolute misery for the pictures.

Did she call herself JK because she fancies being a modern-day Tolkien? "No, it was the publisher's idea," she says. "They were wary of me being a woman." Bloomsbury thought it might put off the boys, so they made her androgynous. "I was so grateful to be published, it didn't matter to me." We talk some more about life after Harry Potter, and she's getting increasingly enthusiastic. "You know, one day, I'd like to experience life as a woman," she says.

• Harry Potter And the Goblet Of Fire is published by Bloomsbury on July 8, priced £14.99.

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