Capital girl: how we all fell for Lily Allen

These days, she lives on a more sophisticated diet of dinner parties, country music and soul. She doesn't go out to bars much, 'because of the fact that I'm quite famous, people would be taking pictures of me if I went out and got trashed,' but she has recently been asked to design one.

Last year she went to the Grey Goose Character & Cocktails benefit for the Elton John AIDS Foundation, where celebrity-designed bars, complete with cocktails, bar stools, and, we hope, bartender's hat, were being sold at auction. 'I thought, "It's such a good idea, but what if you're not a millionaire and don't have that much space?" They would look quite odd in my size living room. So I decided to make something a little bit more compact.'

Her final design is based on aluminium flight cases, portable, stackable ('just like the suitcases I have in my bedroom for storage, by Kim Jones for Dunhill') and mirrored on the outside, with a padded velvet seat on the inside, perfect for lounging on with a cocktail in hand and her beloved vinyl on the turntable. 'My bar is designed to force people to sit and listen to records, like they used to,' she explains.

Stacked with classic 45s and original recordings of her favourite albums, plus jukebox selections made by Rough Trade Records, BBC Radio 2 DJ Steve Lamacq, evergreen broadcasting hipster Robert Elms, and Elton John himself, it's going to be quite a bar. She may even bid for it herself, though the only time she has bid at an auction to date has been 'pretend bidding, to raise the price of something at a charity auction'. That's quite a high-risk strategy. 'Usually I'm sitting next to the person who's bidding.' Teasing them? 'Exactly.' Images of her nudging a silverhaired sugar-daddy tycoon spring, somewhat alarmingly, to mind.

It seems she suffered a mini-breakdown in 2007 when, a few months into a relationship with DJ Ed Simons, one half of the Chemical Brothers duo (techno heroes of hers since her adolescence), she found she was pregnant. News of this somehow reached the media, and when she suffered a miscarriage, it was made painfully public. She split from Simons soon after they lost the baby; therapy, a spell in a private clinic, frequent hair colour changes (pink, brown, peroxide) and a pretty wild summer followed, during which she was photographed engaged in some yacht-based canoodling with the recently divorced 46-year-old art dealer Jay Jopling.

She is now, however, in a steady relationship again, with Sam Cooper, slightly older than her but part of her group of friends ('we've known each other for ten years'). She says he is 'in the construction business' although he's more property developer than brickie. Still, she says, he keeps her grounded. 'It's f***ing disgusting some of the things I do, like not battering [sic] an eyelid over spending two grand on a new pair of shoes, but it's difficult to hold on to reality... Being with Sam has really helped me with that because he's like, "Stop! What are you doing? This money is your future!'' ' He's currently reading Flashman novels aloud to her in bed, and her face lights up when she talks about him.

She thinks of herself as a feminist, but with traditionalist instincts. 'When I have kids, I don't want to be working six days a week, I want to be taking them to school, making them packed lunches, and reading them books every night. So it's important to me that whoever I have kids with has a job so he can support us for the number of years I'm going to take off, so I can be a good mother.'

Her latest album, It's Not Me, It's You, which went straight to number one when it was released this year, included tracks about her mother, sister and father. 'I've never been very good at communicating with my family so I do that by writing them songs, a bit like letters.' The one to her father, the actor and roué Keith Allen, entitled 'He Wasn't There' and detailing his Macavity-style parenting, is, I suggest, more like a letterbomb ['he wasn't there when I needed him/No he was never around...], but she won't have it. 'He loved it a lot!' she cries. 'He just wasn't there for me - I've never called my dad when I've been sad.'

She's thrilled when he rings during the interview, proudly taking the call. When she was growing up, this clearly didn't happen much. A restless charmer and with a nice line in pantomime baddies (most recently, the Sheriff of Nottingham for the BBC's Robin Hood), Keith Allen left home when Lily was four.

A middle child with an older half-sister, Sarah, and a younger brother, Alfie (now an actor), she took her parents' split badly, becoming, aged five, very solicitous about her mother, or 'caretakery' as her mother puts it. More security arrived when Lily's mother started a long relationship with the comedian Harry Enfield and they all moved to Primrose Hill and had 'Chinese in Hampstead every Sunday and a nice car'. Still, Keith was largely absent and Lily's mother had to mop up all her emotion instead. 'I think when I get married my mum will be quite relieved. She'll be like, "Right, that's a weight off my shoulders, now you can call him when you're crying." '

Her childhood unhappiness is never far from the surface. Small hardships still niggle. 'My mum worked so hard to send me to expensive schools but then she was very strict, she was always like, "You can't have that or go on this trip." I was surrounded by these rich kids and when I said, "Mummy, can I have some Gillette foam and a razor?" she said, "No, Lily, you'll use soap." Why couldn't she spend £2 on me? She's definitely taught me the value of things. Investing in bricks and mortar is very important to me. When I was a child I knew what it was like to have your house repeatedly remortgaged and how terrifying that is.'

She's got a savvy entrepreneurial instinct, and is about to turn her voluminous wardrobe into a company, hiring out her clothes as a business that she will run jointly with her half-sister Sarah. After all, last year she spent £100,000 on clothes and jewellery, and a whole section is devoted to Chanel, which she models. Fearing inflation is on its way, she's also investing in art; Jay Jopling helped her buy a Christian Marclay piece. For her birthday this summer, Damien Hirst gave her a huge oil painting stuck with butterflies arranged to spell out 'Lily'. She had to have the doorframe removed to fit it in her flat.

She comes across as very broody, describing herself as 'building a nest'. 'I don't throw things away, I'm constantly thinking, "In ten years' time when my kids are ten that will probably come in handy." I just want to be cosy and have a nice house in the country.' She's got her heart set on a specific valley near Slad in Gloucestershire. 'It was Laurie Lee's valley and it's a very special place so when people move there they don't leave. I've already been looking there for a year now so I guess I'm just... waiting for people to die, really.' While she expresses this yearning for domesticity she is strumming a black acoustic guitar backstage at the Brixton Academy (I have been shadowing her all afternoon). Most rockers end up in a mansion in the countryside eventually, but at 24, Lily wants out earlier than most.

What if she really does settle down and the constant media attention dies away? Won't she miss it? 'If I wasn't in a loving relationship I probably would, because you know all of the fame game is about affirmation. But I think if you're getting the affirmation from the right places, you don't crave it from the public,' she says. She hopes never to end up on I'm A Celebrity..., which she's been watching intermittently. 'That blonde woman vomiting into her hat was hilarious!'

Lily's most recent number one hit, 'The Fear', is a satire written in the voice of someone who longs for instant, reality TV-style fame. She's a tough critic of sell-out culture and (after a trip to India) is planning to put her money where her mouth is. 'I want to take the next couple of years off, get involved with music at a grass roots level. I'm in the process of setting up my own record label. I want to bring a bit more reality to the process, to advise kids that if they sign an advance for £300,000 they have to be really careful or they will suddenly find themselves posing with Sony Ericsson phones. All because they've signed their rights away.'

She isn't going to take sides in next year's election because 'it's a private thing. There's a reason people vote in booths.' She says she can't see much difference between the parties('New Labour is just f***ing Conservative, isn't it?'). But what if her income tax rockets? 'Oh, I'll leave the country,' she deadpans, before making it clear she's proud to pay her taxes and thinks offshore dodges are 'really bad'.

Over the last ten years, she thinks London has become 'more crowded, more dangerous. Or there's more fear. I don't know if it actually is more dangerous. I worry about my mum on the bus, because she's someone who stands up for herself, and if someone pushes her too hard she'll snap back at them and someone might just shoot her in the head or stab her...'

Has Lily, ahem, been on a bus recently? Does she even own an Oyster card? Neatly sidestepping these questions, she says she saw a lot of aggressive behaviour when she was younger and all her friends were at Holland Park comprehensive. 'I saw that behaviour and I probably used to take part in it, to a certain extent...' She speaks with surprisingly formal eloquence, I can't help noticing, like she's trying to impress a teacher. 'I never stabbed anyone but I probably gave the impression I would.'

She puts the problem down to 'lack of parenting, cos in the world in which we live, single mothers have to go out to work and therefore they're not at home teaching their children how to behave on a social level properly and when you don't know how to communicate it does tend to come out in an aggressive way'. What are her solutions? 'Bring back the bus conductor! You don't feel very comfortable with the driver protected behind bulletproof glass. No one else is. The bus conductor, he's the solution to everything. I used to love my bus conductor as a kid on the 73. He had Care Bear badges all over his lapels...'

Meanwhile, what's improved in London in the last ten years? 'My life. Definitely my life has improved.' Grey Goose Character & Cocktails: The Elton John AIDS Foundation Winter Ball is on 13 December from 6.30pm to midnight (greygoose character.com). Contact the Elton John AIDS Foundation on 020 7603 9996 for tickets.

Fashion assistant: Orsolya Szabo. Hair by Tyler Johnson at CLM using Bumble and Bumble. Make-up by Lucia Pica at Management Artists using Alisa. Shot on location at Rodenhurst Road, SW4, via Zownir Locations (020 7738 2002)