The huge Comfort Blanket piece – unveiled at the National Portrait Gallery in central London – is filled with what the Turner prize-winning star says define Britain.
The Sun sits alongside other British icons including the Queen, Top Gear, fish and chips and the Proms.
But there is no room for the Mirror or the Star.
Cross-dresser Grayson said: "I wanted to include The Sun as it is a big part of Britain. It is a definitive part of our country."
The piece is part of Grayson’s Who Are You? collection unveiled to coincide with his new Channel 4 series, which launched last night.
Grayson also created a vase based around disgraced Lib Dem politician Chris Huhne – which he covered in images of a penis.
Grayson said the work had repeated imprints of a willy as it was what got Huhne into trouble in the first place.
He revealed how Huhne wanted to buy the work - although it has been valued at more than £100,000.
She's a silly old cunt.
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