Margaret was betrothed to James of Scotland in 1460. The marriage was arranged by recommendation of the king of France to end the feud between Denmark and Scotland about the taxation of the Hebrides islands, a conflict that raged between 1426 and 1460. Her father, King Christian I of Denmark and Norway (the two realms being united at the time under the Kalmar Union), agreed to a considerable dowry.
William Sinclair, 1st Earl of Caithness, was at that time the Norse Earl of Orkney.
In 1472 he was made to exchange his Orkney fief to Castle Ravenscraig, so the Scottish throne took the earl"s rights in the islands too. This marriage produced three children:
James IV (17 March 1473 – 9 September 1513)
James Stewart, Duke of Ross (March 1476 – January 1504)
John Stewart, Earl of March (December 1479 – 1503).
Margaret became a popular queen in Scotland and was described as beautiful, gentle, and sensible. However, as Ramsay was favoured by the royal family also after the death of the queen, this is considered doubtful and may have been slander, although he did have some knowledge of poisons.
Despite later rumours however there is no reason to think that the King wished for her death.
She died at Stirling Castle on 14 July 1486, and is buried in Cambuskenneth Abbey.