From PEOPLE Magazine Click to enlarge
They arrived separately: he in a dapper tuxedo, she in a slinky, slit-to-there Roberto Cavalli stunner. But inside London's luxurious Grosvenor House hotel on Sept. 21, Prince Harry and his girlfriend of a little more than one year Cressida Bonas were hardly hiding their mutual affection. "They sat together the whole night," says an observer at the Boodles Boxing Ball, a black-tie charity event. Although Princess Kate's sister Pippa Middleton and Harry's cousins Princesses Beatrice and Eugenie were in attendance that evening, the prince focused on only one woman. "He and Cressida barely left each other's sides," says the observer. "They looked very cozy and very much in love. Absolutely."

With condolences to aspiring princesses everywhere, there's no use softening the blow: At 29, the World's Most Eligible Bachelor is truly, madly, deeply in love - and according to several friends and Palace insiders, the 24-year-old Bonas has lost her heart to the ginger-haired prince. Easygoing, artsy, model-gorgeous and from a colorful blue-blooded family (see sidebar), "she's lots of fun, and there's nothing flashy or pretentious about her - there doesn't need to be," says a source close to Princess Eugenie, 23, who is among Bonas's best friends and the one who introduced the couple in July 2012. After keeping the budding romance out of the spotlight for much of the past year, the pair have recently stepped out on a series of public dates, including a James Blunt concert on Sept. 30 and an evening performance of The Book of Mormon in London's West End on Oct. 1. "They are coming out of the shadows," says a longtime observer. Everyone from the British papers to betting houses have taken note (current odds of an imminent engagement: 8 to 11), with one source close to Cressida's family summing up a popular sentiment: "They are quite perfect for each other."

After years of playing the field, the erstwhile party prince and rebellious younger brother to William, 31, "has matured enormously," says Penny Junor, author of an upcoming Harry biography. Following two tours of duty, "Captain Wales," as he is known in the British Army Air Corps, "has a more serious outlook after Afghanistan," she adds. "That changes a person."

So does finding the right love match. Affectionately known as "Cressy," "Smally" and "Snoops" to friends and family, the free-spirited Bonas is a Leeds University grad and modern dancer who shares with Harry a love of adventure, indie rock and late-night clubbing. "She's really sweet, easy to talk to and really funny," says Becci Whelan, 23, who recently completed a postgraduate degree in dance studies at London's Trinity Laban Conservatoire of Music and Dance with Bonas. When it came to her famous boyfriend, she was unfailingly discreet. "You would never have known that she was going out with Prince Harry," says Whelan. "She didn't talk about it." She's a fixture on the London nightlife scene populated by the rich and aristocratic. "She went to a lot of events, but that's because of who she was," says Whelan. "I wouldn't say she was a party girl as such. She was always up for fun, but I wouldn't say she's out doing shots every night of the week."

In fact, her patience with Harry's wild side may have helped win him over. Despite the fact that he notoriously partied in Las Vegas in August 2012—naked billiards, anyone? - within just one month of their first known date at a film premiere, she took the incident in stride. And her ease with the royal family brings a comfort level for Harry, who shared his frustration earlier this year at finding someone "willing to take on the job" of royal-to-be. "She really does know how to conduct herself," says the Cressida family source. The daughter of socialite Lady Mary-Gaye Curzon, 66, a '60s London It Girl, and wealthy entrepreneur Jeffrey Bonas, 69, Cressida grew up in a glamorous blended family. (Curzon has been married four times and has five children.) If anything, her privileged background "may be a bit of a stumbling block," says the family friend. "She is not socially ambitious. She doesn't need the trappings of a prince—but she probably enjoys them."

As for Harry—whose on-off relationship with Zimbabwean-born lawyer Chelsy Davy, 28, ended in 2011—he has made no secret of his yearning to start a family. Besotted with his baby nephew Prince George, he has declared becoming an uncle "fantastic." He has also expressed envy of his brother's domestic bliss with Princess Kate, 31. "[William] gets to go home to his wife," he said while in Afghanistan in 2012. "We're stuck playing PlayStation with a tent full of men." At the same time, he noted, "I don't think you can ever be urged to settle down. If you find the right person and everything feels right, then it takes time, especially for myself and my brother."

For that reason, one close friend says, "it is much too early" to start planning a wedding. William, after all, waited eight years before proposing. "The Queen and royal family like them to wait a bit—to test the relationship," says an insider. But given how carefully Harry has shielded the relationship, friends say he is planning for the future. "He is being very protective of her," says the Cressida source. "I would imagine he is very keen and doesn't want to blow it."

  • Contributors:
  • Simon Perry/London,
  • Monique Jessen/London,
  • Philip Boucher/London.