In a brief statement, Buckingham Palace said: “Following further evaluation this morning, The Queen’s doctors are concerned for Her Majesty’s health and have recommended she remain under medical supervision.
“The Queen remains comfortable and at Balmoral.”
The announcement comes after the Queen, 96, pulled out of a virtual Privy Council on Wednesday, with doctors advising her to rest.
Her Majesty met with incoming Prime Minister, Liz Truss, at Balmoral on Tuesday and asked her to form a government following the resignation of Boris Johnson.
Following the announcement from Buckingham Palace, Ms Truss tweeted: “The whole country will be deeply concerned by the news from Buckingham Palace this lunchtime.
My thoughts - and the thoughts of people across our United Kingdom - are with Her Majesty The Queen and her family at this time.”
In the House of Commons, Speaker Lindsay Hoyle interruped a debate on energy to send the Queen and Royal Family his "best wishes" on behalf of his fellow MPs.
"She and her family are in our thoughts and prayers at this moment," he added.
The Prince of Wales and the Duchess of Cornwall are at Balmoral Castle, where the Queen is under medical supervision, Clarence House has said.
Kensington Palace has said William, The Duke of Cambridge, was travelling to Balmoral, and a spokesperson for Harry, the Duke of Sussex, said he was travelling from Germany to be with his family.
Former Royal correspondent for the BBC Richard Sumner said: “Hopefully this is a passing storm that can be overcome but I think that judging from the careful wording of the palace something serious is possibly going on here.”