The British royals sure do love to keep things in the family, don't they? There's a new report that says Prince Harry might be dating his mother Princess Diana's niece Kitty Spencer. And apparently, his sister-in-law Kate Middleton is thoroughly pleased seeing the two together.

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According to Celebrity Dirty Laundry on Saturday, Kitty is the daughter of Charles Spencer, Princess Diana's younger brother. The beautiful blonde has managed to stay out of the spotlight until about five years ago, when she attended Kate's wedding to Prince William. Now, there are whispers that Prince Harry and Kitty have been secretly hooking up while trying to keep their relationship under the radar.

The Duchess is supposedly elated with the news, because this means her brother-in-law will forget about her sister Pippa Middleton, as they've also been rumored to have gotten up close and personal throughout the years. But for Queen Elizabeth, this is bad news as she apparently doesn't want to see another Lady Spencer marry into the British royal family.

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Blogger Grace Gerard suggested, "Prince William can't be elated with the thought that Prince Harry could possibly marry their late mother Princess Diana's niece Lady Kitty. Is that what Diana would want for her son?"

She added, "There's always the possibility that Prince Harry will reconcile with Chelsy Davey or Cressida Bonas. Kate Middleton would probably be much happier if that were the case. But, if Harry's going to choose a relative as his bride, better Lady Kitty than Pippa, right?"

Tell us Enstars readers, what do you think? Should Prince Harry be dating someone that he is related to?