Oscar-nominated actress Naomi Watts will take on the role of Princess Diana in a new movie about the royal, it was announced today.

Naomi, 43, will portray Diana in Caught in Flight, Oliver Hirschbiegel’s upcoming biopic charting the last two years of the princess' life.

The British-born actress said it was an "honour" to be given the role.

"Princess Diana was loved across the world, and I look forward to rising to the challenge of playing her on screen," she said.

Hirschbiegel, the man behind 2004 critically acclaimed biopic Downfall, said that he was "delighted to have such a truly exceptional actress who embodies the warmth, humanity and empathy of such a global icon as Princess Diana."

Naomi was nominated for a best actress Oscar for her role in gritty 2003 drama 21 Grams.

She has since starred in a string of major blockbusters, including King Kong, The Painted Veil and J. Edgar, and is a close friend of Nicole Kidman's.

Caught In Flight will look at Princess Diana's humanitarian work and her personal life, including her secretive relationship with heart surgeon Dr Hasnat Khan.

The Help star Jessica Chastain was previously tipped for the role, and Charlize Theron is said to be considering taking on the part of Diana in a rival production about her life from producer Stephen Evans.

Production on Caught In Flight will begin in the UK later this year.

What do you think? Is Naomi Watts up to the challenge of portraying Princess Diana? Let us know your thoughts on Twitter or in the comments section below.