OK! can reveal Princess Diana was left horrified and humiliated during her first Christmas with the royal family after unknowingly becoming the butt of an inside joke, when a gag gift from Princess Anne exposed how unprepared she was for life inside the monarchy.

Diana, then 20, had married the then-Prince Charles just five months earlier and arrived at Sandringham in December 1981, facing an intimidating holiday with her in-laws while newly pregnant with her first child, Prince William. What she did not know was that the royal family, who already possessed every conceivable luxury, observed a long-standing tradition of exchanging novelty gifts on Christmas Eve - a custom no one explained to the new Princess of Wales.

According to Diana's biographer Andrew Morton, the moment left her deeply shaken.



Source: MEGAPrincess Diana was left horrified and humiliated during her Christmas with the royal family.



She told him she found Christmas with The Firm "terrifying."One insider told us her disgust was sparked when she unwrapped a toilet paper holder given to her by Anne, particularly because the present was opened in front of Queen Elizabeth and the wider royal family.

Diana, unaware it was an inside joke, had bought Anne an expensive cashmere sweater in return - deemed totally out of place in the gag gift exchange tradition.

Diana also singled out her hatred for the "silly jokes that outsiders would find odd, but insiders understood" during the royals' festive celebrations. Insiders say she felt especially isolated during her first festive season with The Firm, and then firmly cast herself as an outsider within an institution that prized tradition and shared codes.A former royal staffer told us: "Diana arrived at Sandringham expecting a very formal, traditional Christmas and had no idea there was an established culture of joke gifts."



Source: MEGAPrincess Diana gifted Princess Anne a sweater for the holidays.



"Because no one took the time to explain it to her, she was left feeling embarrassed and completely out of her depth," they added. Anne's taste for gag gifts was well established. She once reportedly gave her older brother Charles a leather toilet seat - a nod to his rumored love of taking his own seat on royal trips abroad.

Beyond the presents, Diana struggled with Sandringham's rigid routines. Meals were tightly scheduled, outfits were changed several times a day and the household revolved around watching the Queen's Christmas broadcast at exactly 3 p.m. on Christmas Day. Her former hairdresser Richard Dalton recalled her frustration.

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Source: MEGAPrincess Diana allegedly struggled with Sandringham's rigid routines.



He said: "'She told me it was freezing cold, and dinner had to be over by 3 o'clock,'" adding: "'It's 3 and time to watch me on TV,' she'd say, imitating you-know-who (Queen Elizabeth.)'"The emotional toll of these traditions lingered. Diana's former butler Paul Burrell, who served her from 1987 until her death in 1997, later reflected on how overwhelming the environment was. He said: "Some can stand it, some can't" - before adding: "Diana couldn't stand it."



Source: MEGAPrincess Diana's former butler Paul Burrell served her from 1987 until her death.

Another source said: "That first Christmas with the royal family really cemented Diana's feeling that she was an outsider. The present incident itself was insignificant, but the humiliation lingered because it highlighted how unsupported and alone she felt trying to navigate royal life."In later years, Diana deliberately ensured her sons experienced Christmas beyond Sandringham's confines. She took Princes William and Harry to the theater and to her own family's celebrations, where, according to insiders, there were chocolates and presents the boys could choose for themselves - a contrast to the ritual that once left their mother mortified.