Hedge fund manager James, who is the elder brother of former Made In Chelsea star Spencer Matthews, popped the question to Kate Middleton's little sister Pippa on Sunday, 17th July.
A statement released by the happy couple this week said: "Miss Pippa Middleton and Mr. James Matthews are delighted to announce they became engaged on Sunday 17th July and plan to marry next year."
Kensington Palace said "the Duke and Duchess of Cambridge are absolutely delighted with the news."
Meanwhile, Kate and Pippa's parents, Michael and Carole Middleton, told BBC News they were "thrilled", adding: "They make a wonderful couple and we wish them every happiness together."
Now, the big question is: will Kate be maid of honour for Pippa?
Pippa was chief bridesmaid for Kate's wedding to Prince William in 2011, gaining overnight fame thanks to her figure-hugging white gown and *that* bottom.
Relive the glorious moment below!