"To us, just two loving children, she was quite simply the best mother in the world," Harry said, praising her "unfaltering love" and adding that, behind the media glare, to her sons she was someone "who laughed hysterically and uncontrollably when sharing something silly ... Encouraged us when we were nervous." (See video on CNN.com.)
He urged the family and friends, and those around the world who follow Diana's life, to look to the future and remember her for being "fun-loving, generous, down-to-earth and entirely genuine."
He added, "Put simply, she made us and so many other people happy."
The solemn gathering marked the 10th anniversary of Diana's death and had been organized by her two sons with Prince Charles. Included on the guest list were Queen Elizabeth, the Duke of Edinburgh, Charles, and Diana's friends, singer Elton John, photographer Mario Testino and film director Lord Richard Attenborough.
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Outside the chapel, her admirers gathered. Others, carrying and leaving floral bouquets, poems and photos, congregated outside the gates of Diana's former home, Kensington Palace, which has been a tradition every year on the anniversary of her death.
Tim Graham / Corbis
"Her vulnerability and her willingness to reach out to the excluded and forgotten touched us all; her generosity gave hope and joy to many. May she rest in peace where sorrow and pain are banished," Williams wrote, the Associated Press reports.
Besides readings by William and Harry, who were only 15 and 12 when their mother died, the service also featured a remembrance from Diana's sister, Lady Sarah McCorquodale.
Once the formal ceremony concluded inside the chapel, the princes accompanied their father and grandparents to their cars outside. The princes, who received the cheers of the crowd, then took more than 20 minutes to greet other guests as they left. Harry even shared a joke with his cousins, the Princesses Eugenie and Beatrice.
In Paris, where the "People's Princess," as Diana had been nicknamed, died in a high-speed car crash alongside her lover, Dodi al-Fayed, several mourners gathered and left bouquets at the tunnel where the fatal incident occurred, Reuters reports.
A note, scrawled on a portrait of Diana in a jeweled crown, read: "10 years already, Oh how I miss you." It was signed "Monique de Luxembourg."
Reporting by SIMON PERRY