Indeed. For over 30 years now, he's been one of the great cult heroes of the British folk scene, though his songs have been covered not just by traditionalists like June Tabor but by anyone from Elvis Costello to Bonnie Raitt and American alt rockers Dinosaur Jr. He's one of our greatest guitarists, both as an acoustic and electric player, and has recently recorded the soundtrack for Werner Herzog's film, Grizzly Man. Then, of course, he played a key role in the early history of folk-rock, along with Fairport Convention and Sandy Denny

Along with all that there will be a selection of the old Thompson classics "from the 1960s on", that often change, or are used as the springboard for different guitar improvisations, every time he plays them. Thompson's remarkable output over the years can be judged from his next major release, RT - The Life and Music of Richard Thompson, an epic five-CD boxed set with 92 tracks.

It contains some surprises, including a rousing tribute to the Who and a selection of often sturdy songs like Lucky in Love that were never recorded. For artists eager to cover little-known Thompson songs, this could be his answer to Dylan's Basement Tapes. As with Dylan, the key to Thompson's wildly eclectic career starts with his influences back in the 1960s.

"Did you see the Dylan documentary?" he asks. "He was brought up in Minnesota and there was nothing interesting there. He had to go to New York to find Woody Guthrie and the music. But in London, everything was here. There were jazz clubs, folk clubs and rock clubs and I used to go to them all."

Thompson attended William Ellis school in north London, where he played in a school band with Hugh Cornwell, of Stranglers fame, and then joined Fairport Convention, along with his friends Simon Nicol and Ashley Hutchings. The band "customised ourselves to whatever the gig was. So if there was a gig at a blues club for £15 we'd be a blues band, and if a folk club offered £10 we'd be a folk band. So the first Fairport album was insanely eclectic." As for folk-rock, "it was Ashley who pushed us in that direction, but it was emphasised by the arrival of Sandy Denny and Dave Swarbrick", both from the folk scene. It was this line-up that recorded the Liege and Lief album in late 1969. Mixing traditional ballads and Thompson songs with blistering guitar work, it was rightly hailed as a classic.

"It was a project, a one-off," says Thompson. "It was not there to set the direction of the band, though it did." He had no doubt about its importance. "It was the first folk-rock album, and people applied it to their different cultures. In America, Los Lobos listened to it and thought it validated what they did, playing their traditional music as well as blues."

Thompson will break off from his tour to revisit the Liege and Lief era. On February 6 he'll be at the BBC Folk Awards for what promises to be a historic evening. Also present will be the surviving members of the 1969 Fairport line-up, and Liege and Lief is surely a contender for the award for "most influential folk record of all time".

The late Sandy Denny will be sadly missed, of course, but the chance of hearing Thompson reunited with Hutchings, Nicol and fiddler Dave Swarbrick (now apparently well enough to attend) is an intriguing prospect, even though Thompson regularly appears at the Fairports' summer festival in Cropredy. "I never escaped from Fairport, and that's fine. I'm quite proud of the old chaps," he says.

Richard Thompson may not see himself as a folk singer, but the folk tradition has helped influence the often bleak and sad-edged songs he has written since leaving Fairport Convention. "If you want to write and structure a song," he says, "the folk scene is not a bad place to learn." Folk music, and reading, also influenced his famously dark lyrics. His father was "an expatriate Scot, a history buff who loved poetry," and he spent his childhood reading the novels of Walter Scott and books of ballads.

"I ditched them at 13 when rock'n'roll came along, but I must have absorbed some of the stuff. Scottish balladry has incest, murder, people carried off by fairies, set in a bleak landscape, that's what I'm used to. So I think of my subject matter as normal, though by music standards it's on the dark side.

"It's like the blues," he adds. "In the guise of entertainment you sing about problems. I don't think catharsis is the point but there may be catharsis in it."

His Englishness seems to have increased with his move to LA, with references to anything from Penge to "the pewter skies over NW11" in his recent compositions. "There's a theory that it helps you to have perspective if you leave what you're used to and go away," he said. "You get a sharper focus. It worked for Robert Louis Stevenson."

Now in his mid-50s, Thompson's career is still on the rise. In the US, his songs are played on college radio, and in Britain last year he was invited to a music industry bash at Buckingham Palace. "I told the Queen I was a singer-songwriter, because she had just met Jimmy Page and Eric Clapton and I didn't want to confuse her by being another guitarist."

There's yet another folk revival underway, celebrated by the forthcoming Folk Britannia series on BBC4 (that, of course, includes a contribution from Thompson), and there's a growing audience for his modern ballads. In concert, he said, his two most popular songs of the moment are Beeswing and 1952 Vincent Black Lightning, "and they are both five to six minute ballads. It's gratifying that in this age of eight-second soundbites people can sit in a concert and listen to a story."

· Richard Thompson is at Warwick Arts Centre, Coventry, until January 21, and then tours. RT - The Life and Music of Richard Thompson is released on Free Reed on February 6. Front Parlour Ballads and Grizzly Man Soundtrack are out now on Cooking Vinyl

Useful links
Richard Thompson official site

BBC Radio 2 Folk Awards 2006