Zara Phillips and Mike Tindall are expecting a baby in the New Year, according to a Buckingham Palace spokesman.
A Buckingham Palace spokesman, using Zara's married name, said the couple's families were "delighted" with the news:
David Cameron's official spokesman described the announcement as "quite terrific news" with the Prime Minister set to send his best wishes to the couple.
The birth will follow the impending arrival of the Duke and Duchess of Cambridge's baby, which is expected in the coming days.
Zara Phillips, an Olympic equestrian silver medalist, fell over while competing at the Barbury International Eventing and Show in Marlborough, Wiltshire a few days ago, but an official spokesman played down any health fears describing her "fine".
A Royal spokesman did not rule out Zara competing in the next Olympics in Rio despite impending motherhood saying: "She can still compete, it totally depends on horses and whether she feels it's appropriate".
Phillips married former Rugby Union international Mike Tindall in July 2011 in Edinburgh which was attended by the Queen and other senior royals.
The baby will be the Queen's fourth great grandchild after Zara's brother Peter Phillips' two children and William and Kate's child which is expected in mid July.