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London, England (CNN) -- Britain's Prince William asked his girlfriend Kate Middleton to marry him, he said Tuesday, setting up the most anticipated royal wedding since Prince Charles and Diana, princess of Wales, got married nearly 30 years ago.

William gave Diana's sapphire-and-diamond engagement ring to his fiancee when he popped the question during a vacation in Kenya last month, he said.

"It's my mother's engagement ring, so of course it's very special to me, and Kate's now very special to me, so it was only right to put the two together," he said Tuesday.

"It was a total shock" when the prince proposed, Middleton said, adding that she was very excited. "We were out there with friends and things, so I really didn't expect it at all."

The ring, a huge sapphire surrounded by diamonds, was last seen in public on the day Charles and Diana divorced, royal biographer Mark Saunders told CNN. That was in 1996.

William said there was "no pressure" for Middleton to emulate Diana.

"It's about carving your own future," he said. "No one is trying to fill my mother's shoes."

The couple seemed happy and relaxed in their first interview after announcing the engagement Tuesday, teasing each other about his cooking and his romanticism, each drawing laughter from the other.

Tuesday's announcement ends years of speculation about whether and when the prince -- who is second in line to the British throne -- would propose to his longtime girlfriend.

The prince and Middleton, both 28, have been dating since 2003.

"It was the right time and I'm very glad to have done it," William said in an appearance with Middleton.

"We're obviously thrilled," said William's father Prince Charles. "They've been practicing long enough."

"They make a lovely couple, they're great fun to be with and we've had a lot of laughs together," said Middleton's parents, Michael and Carole Middleton. "We've got to know William really well. We all think he's wonderful and we're extremely fond of him."

The wedding will take place in London in the spring or summer of 2011, Charles's office at Clarence House said. It said further details would be announced "in due course."

"Prince William and Miss Middleton became engaged in October during a private holiday in Kenya," the statement said. "Prince William has informed the queen and other close members of his family. Prince William has also sought the permission of Miss Middleton's father.

"Following the marriage, the couple will live in north Wales, where Prince William will continue to serve with the Royal Air Force."

William's grandparents, Queen Elizabeth II and her husband, Prince Philip, are "absolutely delighted for them both," Buckingham Palace said.

His brother Prince Harry said he was "delighted that my brother has popped the question! It means I get a sister, which I have always wanted."

Clarence House refused to say what Middleton will be called after she gets married, saying any styles and titles are at the discretion of the queen.

William met Middleton in 2002 when both were students at the University of St. Andrews in Scotland. They started dating a year later.

Prince William studied geography and Middleton studied history of art before both graduated in 2005. William was originally in the same art program but changed to geography; Middleton was widely credited with persuading him to change course rather than drop out.

They first appeared as a couple on a skiing trip in Switzerland while still at the university.

British Prime Minister David Cameron said he spoke to Prince William after the news was announced and passed on his congratulations.

"It's great to have a piece of unadulterated good news that everyone can celebrate," Cameron said. "I'm sure it will be something where the country will come together. ... It's two young people who love each other who've made this decision, and it's a fantastically important and exciting moment for them, too."

Middleton grew up in Bucklebury, England, a small village about 45 miles west of central London. Her parents are millionaire entrepreneurs who run Party Pieces, an online children's party supplies business.

After university, Middleton worked in London as an accessories buyer for the British clothing chain Jigsaw but left the company in late 2007. Media reports said she was interested in opening a photography gallery.

She is working now with her parents' business, she said.

Prince William has a military career and is active in several charities. In September, he graduated from a military search-and-rescue training course and was posted to RAF Valley, the station on the island of Anglesey in north Wales.

He is known as Flight Lieutenant Wales within the RAF.

Middleton lives with her fiance at a house in Anglesey, giving them some privacy from the press and paparazzi, said Eve Pollard, a former editor of the Sunday Mirror newspaper.

The choice of 2011 as the year for the wedding makes sense, she said, because two major events are already scheduled for the following year.

The Olympic Games take place in London in 2012, the same year the queen plans to celebrate her Diamond Jubilee, marking 60 years on the throne.

"Next year was always marked in as the year," Pollard said.

Nicholas Davies, the author of "William: The Rebel Prince," said he thinks William was pressured to come through with the engagement.

"I do believe this came down from the queen and Prince Philip, who is still a very strong character despite his venerable age," Davies told CNN. "They would have said, 'This has gone on long enough. The press knows you're getting married. It's about time you came out and made it known.'"

As for when in 2011 the couple will marry, Clarence House refused to speculate. Bookmakers Paddy Power on Tuesday were offering 3-1 odds on August 13, 2011, being the wedding date, and 4-1 odds on August 6.

It said Saturday, July 30, was less likely, at 10-1 odds, because it falls just a day after the 30th anniversary of the wedding of Charles and Diana.

The location for the wedding was also being kept secret, though Richard Fitzwilliams, a public relations consultant and royal commentator, told CNN he expects it to happen at Westminster Abbey, probably in July.

William and Middleton broke up in April 2007, despite widespread speculation even then that they were close to marriage. The split was said to be amicable, with the couple determined to remain friends, and the two appeared together in the royal box at Wembley Stadium that July for the Concert for Diana, a charity event to remember William's mother 10 years after her death.

The pair were seen together several more times that summer and were dating again by the end of the year.

Middleton's family is seen as upper-middle class. Such a background bodes well for her future role at the side of the future king, according to Lady Colin Campbell, who wrote a biography of Princess Diana.

"The problem with recent royal brides who were aristocratic is that they thought they were doing the royal family a favor by marrying them," she told CNN, "while the middle-class girls like Sophie Wessex, the countess of Wessex (married to Prince Charles' brother, Edward), and Kate Middleton understand that to be royal requires some sacrifice, and they do not suffer from folie de grandeur [delusion of greatness] the way aristocratic girls evidently do nowadays."

William biographer Davies, however, said he feels the opposite about Middleton, who he said lacks the "charisma" shown by William's mother.

"Remember that this young lady has no royal connections whatsoever, and that can be a danger," he said.

But journalist Pollard said William chose his bride carefully.

"I think the queen's understood that it's very important for William to make a happy marriage," Pollard told CNN. "He watched his parents be unhappy, and the fact that they [William and Middleton] have stayed together for so long and they have been together for so long rather proves that they get on very well."

CNN's Melissa Gray and Phil Han in London, England; Dan Rivers in Dorset, England; and Michael Pearson and Arthur Brice in Atlanta, Georgia, contributed to this report.