Kate Middleton Wearing Princess Diana's Engagement Ring

Kate Middleton in Gloucester, Oct. 2010: Ikon Pictures, PacificCoastNews.com.

Prince Harry gave William the OK.

Kate Middleton and Prince William are finally engaged, as we reported when news broke Tuesday. We have new details on Middleton's sapphire engagement ring, and why its former place on Princess Diana's finger could have caused bad blood between Princes William and Harry.

If Kate Middleton's rise to princessdom leaves you with any doubt, this should squash it: Middleton's status in Clarence House is so secure that she's wearing the engagement ring that once belonged to Princess Diana. Prince Charles gave the ring to Diana in February 1981, and its massive oval sapphire cut surrouned by 14 rounds of diamonds is as sizable and stunning three decades later as it was when Diana wore it.

Read: Prince William, Kate Middleton Wedding  Buzz

When Princess Diana passed away in 1997, word has it that it was actually Prince Harry who accepted the ring as an heirloom -- not William. But our pals at PopEater have an interesting report that when Prince Harry knew his brother was preparing to propose to Kate Middleton, he happily handed over his mother's engagement ring so Prince William could do the deed with a wow: "Harry was happy to give the ring to his brother," a royal insider revealed Tuesday. "He loves William and thinks it's only right that one day the woman sitting next to the King will be wearing his mother's ring. That's the way Diana would have wanted it."

Read: Kate Middleton's Parents Spotted with Prince William

It's reported that back in 1981 when Prince Charles bought the ring, it was valued at $40,000. Today, PopEater reports, "[W]ith its association with Diana, the magnificent piece of jewelry is considered priceless."

Click around for more background on the long-awaited engagement between Prince William and Kate Middleton. And if you're a rubbernecking fool for the jewel, PopEater has a shot.

Read: Prince William, Kate Middleton Engaged