The painting, titled La Lecture, depicts Marie-Thérèse Walter asleep in a chair with a book on her lap.
It was purchased by an anonymous buyer, who bid over the telephone against at least six others in a bidding war that lasted six minutes.
The pre-sale estimate for the work was £12 – 18 million.
“We were thrilled with the price achieved for Picasso’s La Lecture – an exceptional work from one of the artist’s most celebrated periods," Helena Newman, Chairman of Sotheby’s Impressionist & Modern Art Europe, said in a press release
"The painting attracted strong pre-sale interest from across the globe, which was manifest in the depth of bidding we saw tonight - no fewer than seven bidders drove the price to a final £25.2 million. Across the sale as a whole, buyers came from 11 countries, with bidding from Asia, Russia, the US and Europe.”
Picasso was married and in his mid-40s when he began the affair with the young woman, and their relationship was kept secret for several years. They had one child- a daughter called Maya.
The Sotheby's press release
stated that he had embedded his lover's features in the background of previous paintings but " by the end of 1931, Picasso could no longer repress the creative impulse that his lover inspired, and over Christmas and New Year 1931 and ‘32, Marie-Thérèse emerged, for the first time, in fully recognisable, languorous, form."
reported that Thomas Bompard, from Sotheby’s, said the painting was part of an exhibition in June 1932, but after that its whereabouts were unknown until 1940 when it was rediscovered in New York.
According to Luxist
, the painting was "part of a colorful explosion of works painted in January 1932 in anticipation of the major retrospective that he was planning."
Last year it was reported that a painting of her called Green Leaves And Bust, which Christie's
called "a sensuous and stunning masterpiece," sold in New York for a world record of £69.8 million ($106,482,500)