Princess Beatrice sliced open Ed Sheeran’s face with a sword while attempting to “knight” James Blunt as a party prank.
Ed, 25, was rushed to hospital after Bea, 28, swung the ceremonial blade over her shoulder without realizing he was behind her.
He showed off the scar this week after the Windsor knees-up.
One source said: “He could’ve been blinded.’’
The royal had grabbed a sword after soldier-turned-singer James Blunt, 42, joked that he would love to become a Sir.
But as she said “arise Sir James”, she is believed to have misjudged the weight of the blade and had no idea Ed Sheeran was standing right behind her.
Singer-songwriter Ed, at the party with girlfriend Cherry Seaborn, was taken to hospital for treatment to a gash under his eye.
Beatrice was said to be “inconsolable”.
Ed, whose hits include Bloodstream, later returned to the do at the Royal Lodge in Windsor, home to Bea’s dad Prince Andrew.
Andrew was away on business but Bea’s mom Sarah Ferguson, who has staged mock knighthood ceremonies in the past, was at the do earlier this month.
Pictures of Ed’s injury were posted online, leading fans to speculate over the cause.
Our source revealed: “Ed had been invited to dinner as a guest of Princess Beatrice.
“They all sat down and there were 20 or so guests, including Sarah Ferguson, James Blunt and his wife Sofia Wellesley.
“Prince Andrew was in Mexico on a trade mission.
“As the night wore on they started talking about honors and apparently James Blunt joked that he would love a knighthood.
“Beatrice jokingly said she could arrange it and fetched a ceremonial sword.
“Everyone was having a great laugh and the joke was very much in keeping with the tone of the whole party.
“James played along with the prank and got down on one knee as he would if he were at Buckingham Palace being honoured by The Queen.
“Beatrice, who was in great form, held the sword above him and said ‘arise Sir James’, just like her nan would at the Palace.
“But she must have misjudged the weight or something and, instead of lightly tapping him on the shoulder, she swung it back, not knowing Ed was standing right behind her.
“The blade cut into his face and it was just a few inches from his right eye.
“A couple of the guests said it could have been worse and he could have been blinded in the eye but Ed really played it down.
“Everyone was totally shocked and apparently Beatrice was very upset.
“But Ed was the perfect gentleman and told her it was just an accident.
“However it became apparent that the wound needed treatment so Ed was taken to hospital. He had to have stitches put in.”
The star was treated at a nearby hospital before returning to the royal bash.