Katie, 31, announced her exciting news on Twitter after James popped the question last night.
The inspirational star, who gave birth to their first child - daughter Belle - in March, told her followers: "So excited to tell you all.............. I became someone's fiancée last night! I'm engaged to be married :)."
Katie has since been inundated with messages of congratulations and has thanked fans for their good wishes.
"Thank u so much 4 all of lovely congratulations msgs," she later said. "I'm reading them out 2 B instead of her usual story book! Very touching Msgs thank u."
Katie has been in a relationship with carpenter James, who likes to keep out of the public eye, for several years and last night they enjoyed a romantic meal at home.
Sharing a picture of herself sat at the dinner table, Katie told her Instagram followers at the time: "Pretending we are going out for dinner!
"Cooking 3 course meal, dressed in our best clothes - all taking place at our kitchen table! Parents night in/out #nobabysitterneeded."
She then posted a snap of her meal, adding: "I think my boyfriend has potential as a chef! Baked Cod with Capers."
In 2008, Katie suffered severe burns in a horrific acid attack organised by her violent ex-boyfriend. Since then, she has undergone numerous operations and tirelessly helped fellow burns victims after launching The Katie Piper Foundation.
Last week, Katie was joined by the likes of Mel B, Cheryl Fernandez-Versini and Simon Cowell at a ball held to raise money for the Foundation.
Writing in her recent autobiography, Beautiful Ever After, Katie spoke about the moment she and James discovered they were expecting a baby together.
"Those little blue lines, that promise of another new beginning, reaffirmed my feeling that we all have a plan in life that's written for us," Katie said.
"I learned the hard way in my mid-20s that you simply can't control everything that happens to you, and you have to accept that some of it just won't make sense."
Congratulations, Katie and James.
Celebrities who have got engaged in 2014:
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