Irish Prime Minister Albert Reynolds (at left) with British Prime Minister John Major in London in 1993. Mr. Reynolds played a key role in advancing talks towards brokering peace in Northern Ireland. (Dylan Martinez/Reuters)

Albert Reynolds, the straight-talking Irish prime minister who played a key role in delivering peace to Northern Ireland but struggled to keep his own government intact, died Aug. 21 at his home in Dublin. He was 81.

His eldest son, Philip, announced the death; the cause was Alzheimer’s disease.

Mr. Reynolds, a savvy businessman from rural County Roscommon who made millions running rural dance halls and a pet food company, led two feud-prone coalition governments from 1992 to 1994.

During his turbulent tenure, Mr. Reynolds made peace in neighboring Northern Ireland his top priority. With British Prime Minister John Major at his side, he unveiled the Downing Street Declaration, a 1993 blueprint for peace in the predominantly British Protestant territory. To drive it forward, he successfully pressed the outlawed Irish Republican Army to call a 1994 cease-fire.

“Everyone told me: ‘You can’t talk to the IRA.’ I figured it was well past time to bend some rules for the cause of peace,” Mr. Reynolds told the Associated Press in a 1994 interview.

Yet within months of that peacemaking triumph, a stunned Mr. Reynolds was forced to quit as leader of Ireland’s centrist Fianna Fail party after his coalition partners in the left-wing Labor Party withdrew from the government in protest over his dismissive management style.

His longtime press secretary, Sean Duignan, described Mr. Reynolds as “a born gambler — at the track, in business and politics.”

That appetite for walking a political tightrope worked wonders in Northern Ireland, where a quarter-century of conflict had left more than 3,500 dead.

Mr. Reynolds built alliances with President Clinton and Irish American leaders who wanted to coax the IRA-linked Sinn Fein Party in from the political cold. Pushing from one direction, Mr. Reynolds demanded that Sinn Fein leader Gerry Adams deliver an open-ended IRA truce; from the other, he cajoled a skeptical, reluctant Major toward direct contact with Sinn Fein.

“We’ve been able to have the fiercest of rows without leaving scars. I understood Albert’s difficulties and he understood mine,” Major recalled.

Clinton said Mr. Reynolds’s work alongside Major provided the bedrock for Northern Ireland’s eventual 1998 peace accord, “and our world owes him a profound debt of gratitude.”

Many analysts have said that Northern Ireland peacemaking would have progressed more quickly had Mr. Reynolds stayed in power. But his “act-first-get-permission-later” approach proved unworkable in a Parliament where the long-dominant Fianna Fail — Gaelic for “Soldiers of Destiny” — no longer commanded a majority on its own.

Even before becoming prime minister, Mr. Reynolds was accused of recklessness. In the late 1980s, while running Ireland’s commerce department, he concocted a state insurance scheme for the country’s top beef baron to export cattle to Saddam Hussein’s Iraq. Taxpayers ultimately repaid the beef industry about 225 million euro ($300 million) in losses when Iraq failed to pay.

Mr. Reynolds’s first coalition government collapsed in 1992 during a state investigation into the ethics of that deal and wider corrupt practices in Ireland’s mammoth beef-export industry.

His second government fell apart almost as quickly as he repeatedly made decisions without consulting his new junior partner, left-wing Labor. The final straw came when he dismissed Labor’s objections to the promotion of his attorney general, a Catholic conservative who was accused of suppressing a Northern Ireland extradition warrant for a pedophile priest.

Some of the warmest tributes to Mr. Reynolds after his death came from business leaders, who conjectured that his decisive style would have been ideal to oversee Ireland’s emerging Celtic Tiger economy, rather than his Fianna Fail successor, Bertie Ahern. That decade-long boom ended in a 2008 burst property bubble, with crippling bank rescues and Ireland teetering on the brink of bankruptcy.

Mr. Reynolds “wasn’t perhaps the greatest politician in the world. He managed to blow up two coalitions in a relatively short period of time,” said Michael O’Leary, chief executive of Ireland’s most successful company, budget airline Ryanair.

“But if you go back and you ask Irish people now if you could have visionary, dynamic and bold leadership like Albert Reynolds, or the 10 years of dither, fudge, and buying off of various stakeholders that came after him under Bertie, I think everybody would go back and have Albert in a flash,” he said.

Albert Reynolds was born Nov. 3, 1932, in the village of Rooskey, where his father was a farmer. He attended Summerhill College in Sligo and sold candy to fellow students to earn money.

After leaving school before graduating, he held a variety of sales jobs before starting a dance hall in the 1960s with members of his family. He soon opened several more around the country, but sensing that the dance-hall craze was nearing its end, he diversified his holdings to include a bacon-curing plant in Dublin and a pet-food manufacturing company. His C&D Foods for pets became his most enduring business.

In the 1970s, he began to enter local Irish politics, serving on a county agriculture committee and as president of the county’s chamber of commerce.

Survivors include his wife, Kathleen Coen, and seven children.

— Associated Press

Adam Bernstein contributed to this report.