Bettencourt, whose mental health is reportedly declining, will be placed under a grandson's guardianship and her wealth and property under that of her daughter Francoise and two grandsons, Charlotte Robbe-Phan said.
Bettencourt is on L'Oréal's board of directors but since family members are to be her guardians the court's decision should have little impact on the running of the cosmetics giant.
The Bettencourt mother and daughter have been at the centre of a very public feud over the fate of France's third-largest family fortune.
The website of newspaper Le Monde on Monday quoted a medical report for use by the court as saying that Bettencourt was suffering from "mixed dementia" and "moderately severe" Alzheimer's disease.
Bettencourt "suffers from cognitive difficulties evidenced by temporal disorientation, memory problems, reasoning difficulties and aphasic elements," Le Monde quoted the report as saying.
The report said Bettencourt "presents with Alzheimer's disease at a moderately severe level with a possible vascular participation" and that she is in the midst of a "slow and progressive process of cerebral degeneration."
Bettencourt-Meyers has argued that her mother is mentally unfit to manage her estimated €16 billion euro ($20 billion) fortune.
In an interview published in Sunday's Journal du Dimanche, Bettencourt threatened to leave France if her daughter manages to place her under her guardianship.
"If it's that, I will go abroad. If my daughter looks after me I would feel stifled. If it's her, I will leave," she said.
Bettencourt-Meyers has alleged that people close to her mother, including celebrity photographer Francois-Marie Banier, took advantage of the heiress.
Banier was Bettencourt's sole named beneficiary in a will drawn up in December 2007. But Bettencourt broke with Banier earlier this year, cutting him out of her will and depriving him of an estimated €1.25 billion.
Mother and daughter have been involved in legal battles for three years.