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When U.S. Secretary of State Madeleine Albright learned that PEOPLE planned a story about her for our Best and Worst Dressed issue, she laughed. "I've never thought of myself that way," Albright told her staff. Then she recounted how, as a scholarship student at Colorado's ritzy Kent Denver School in the 1950s, she once topped her plaid uniform skirt with a patterned blouse, prompting a teacher to pull her aside for a sartorial heart-to-heart. "She said, 'Madeleine, you are never supposed to wear prints with plaid,' " Albright recalled. "I never forgot it. I appreciated her telling me."

Some 40 years later, that awkward girl has grown into a woman with international clout and impeccable style. Since becoming the first female Secretary of State in January 1997, the Czech-born Albright, 61, has brought new panache to power dressing, winning praise for her colorful, well-tailored suits and bold brooches as well as her tough negotiating. "She's not a glamour girl, but she has a stylized look," says Ann Blackman, a TIME correspondent and author of Seasons of Her Life, an Albright biography to be published in November. "She's smart enough to understand that people judge you not just on how you are, but how you look."

That didn't matter so much in the 1970s and '80s, when Albright was an international-affairs professor at George town University and a key Democratic foreign policy adviser. But after her 1993 appointment as U.S. representative to the United Nations, the divorced mother of three adult daughters turned to fashion-savvy friends to sharpen her image. "She realized she was going to be in a very visible position," says Blackman. "Her girlfriends got together and said, 'You have to look your part. Let us help.' " The busy Albright had relied on such aid before. She didn't even select the pink Mary McFadden dress she wore to daughter Alice's 1988 wedding, recalls Wini Freund, a pal since childhood: "I picked it out and sent it to her."

But Albright was beginning her fashion education. During her years at the U.N., she spent her rare free moments browsing at Saks Fifth Avenue. ("Shopping was a way of relaxing, rather than being on the golf course," explains Millie Harmon Meyers, the U.S.'s chief of protocol at the U.N.) Now she's a regular at Washington, D.C.'s upscale Rizik Bros. "She loves clothes that have beautiful textured fabrics and favors long jackets," says co-owner Maxine Rizik. "She knows the shortcomings of her figure, so she never chooses bold prints."

Scarf designer Frankie Welch, long an observer of Washington style (she dressed former First Lady Betty Ford), says Albright's strategy works. "I think she has more power by dressing the way she does than if she were 35 with a svelte figure," Welch says. "She wears good clothes that are well tailored and a good length. She uses color well to be seen."

Now it's Albright who decides what to wear when. If she's traveling, she takes into account weather conditions, event schedules, cultural sensitivities and, yes, politics. Her symbolic brooches have been noticed since her time at the U.N. "After the Iraqis called her a serpent, she wore a snake pin when she met with Deputy Prime Minister Tariq Aziz," Meyers remembers, adding, "She has a very creative mind." And this year, when Albright visited the site of China's Tiananmen Square massacre, her hat was white, the color of mourning in that country. Coincidence? "Having served at the U.N., she knew very well that people would track what she would wear and that people would give thought to it," says Carl Fritz, a spokesman for the State Department's East Asian and Pacific Desk.

These days, Albright often sports a patriotic eagle or U.S. flag brooch. "I never made a point of starting a collection of pins, but in my work, I discovered that some pins had a good message," she told Newsday last year. Other accessories, like her signature Stetson, are chosen for more practical reasons. "If, after having slept and worked on a plane for a number of hours, you are going to deboard with cameras out on the tarmac," says an Albright aide, "you are going to look better and represent your country better with a hat on than you would without."

And though Albright takes pains to look ready for business (she has an assistant carry her purse so she can "go in with her arms swinging like a man," says Blackman), she doesn't hide her femininity. "She always has an appropriate piece of jewelry," notes Gale Hayman, author and cofounder of Giorgio Beverly Hills boutique. "Not like Janet Reno with nothing—she'll have something that shows, 'Yes!' she is a woman."

And proud of it. Unless flat shoes are absolutely required (as when boarding a helicopter), the petite Albright insists on wearing pumps—"she stays in her heels all day," an aide reports—and keeping at least a lipstick nearby. "I've kidded that the advantage of being a woman Secretary of State is makeup," she told Harper's Bazaar last year. "When you're absolutely exhausted, you can paint on a different face and be okay."