Labour's deputy leader recalled the moment she saw a note confirming Queen Elizabeth II had fallen seriously ill, before Keir Starmer had to leave the Commons chamber to be briefed.
Ms Rayner said she remembered thinking 'this is going to change everything' when frontbenchers were handed the foreboding message.
She said that the note was written 'in plain English' and made it clear how serious the situation was.
Speaking on The News Agents podcast, she said: "I read between the lines on that because you don't get a note saying the Queen's unwell if she's got a bit of a cough and a cold."
She added: "The first thought that went through my mind was a personal thought of 'oh my God, this is going to change everything'."
Angela Rayner describes the moment she found out about Queen Elizabeth II's ill health
House of Commons
She said the coronation should be scaled back as a 'kind gesture' to people who are struggling to pay their bills, especially during the winter period.
Ms Rayner recalled that the note was handed to Mr Starmer while he was speaking about the cost of living crisis in the Commons.
Describing how she tried to inform her party's leader, Ms Rayner said: "I was trying to get the note to him without being too dramatic, but also not knowing exactly what was going on, but that I needed to get him out of the Chamber.
"It was only when the Speaker kind of indicated, because I kept the note and I was trying to think, how am I going to get it to Keir without totally ruining what he's trying to say."
She continued: "So I was kind of waiting for my opportunity to do it. And then I looked over at Mr Speaker and he's giving me the nod of ‘this is actually quite urgent’, i.e. don't wait for your opportunity. So I kind of knew that it was quite an important moment."
In that moment, Ms Rayner said she felt "incredibly sombre" as the realisation of what happened hit.
After leaving the chamber, she and Mr Starmer were briefed by Cabinet Secretary Simon Case.
They learned about the monarch's death shortly before it was announced to the public.
Queen Elizabeth II died on September 8
Andrew Milligan
Talking about the coronation of King Charles III, she said: "I think people will see that as a really responsible, kind gesture.
"They know he comes from privilege, they know that he's not worried about his gas bill."
She continued: "There's a lot of people that’ll be angry, because there is a lot of upset out there, because people are absolutely petrified about their future.
"But I think from my background, which is very working class as well, the fact that somebody of his stature recognises that, actually is quite a respectful thing.
"That somebody, the King of our nation has said ‘I recognise that things are difficult for you’. Actually, I think that's quite a respectful thing for him to do."