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Of the milestone, the couple said in a statement, "We are both so excited to be embarking on this life adventure together and can't wait to be married. We share so many similar interests and values and we know this will stand us in great stead for the years ahead, full of love and happiness."
Some of the engagement portraits released as part of the announcement were taken by Princess Beatrice's sister, Princess Eugene, who had her own royal wedding almost a year ago.
Eugenie said of her sister's big news, "Beabea - wow! I'm so happy for you my dearest big sissy and dear Edo. It's been a long time coming and you two are meant to be."
The Duke and Duchess of York said in the official Buckingham Palace statement, "We are thrilled that Beatrice and Edoardo have got engaged, having watched their relationship develop with pride. We are the lucky parents of a wonderful daughter who has found her love and companion in a completely devoted friend and loyal young man. We send them every good wish for a wonderful family future."
The princess's mother also went to social media with the news of the next wedding to highlight the newest members of their family, saying "Andrew and I are just the luckiest people ever to have two great sons in law."
Princess Beatrice is ninth in line to the throne, according to the BBC.
The wedding is scheduled for next year, but an exact date has yet to be released.