Directed by Oliver Hirschbiegel (Academy Award nominated Downfall), and based on the screenplay by Stephen Jeffreys, production will begin in the UK later this year.
Caught in Flight is a compelling portrait of Diana, Princess of Wales during the last two years of her life. It charts how finding true personal happiness for the first time allowed her to achieve her defining successes evolving into a major international campaigner and humanitarian.
Speaking earlier, Naomi Watts, who will next be seen starring in The Impossible opposite Ewan McGregor said: "It is such an honor to be able to play this iconic role - Princess Diana was loved across the world, and I look forward to rising to the challenge of playing her on screen."
Director Oliver Hirschbiegel commented: "I am delighted to have such a truly exceptional actress who embodies the warmth, humanity and empathy of such a global icon as Princess Diana."
Ecosse Films' Robert Bernstein stated: "It is very exciting to be working with one of our finest actresses, Naomi Watts, on what will be a powerful and poignant film. She will encompass the role beautifully."
Diana was released November 1st, 2013 and stars Naomi Watts, Naveen Andrews, Douglas Hodge, Geraldine James, Charles Edwards, Daniel Pirrie, Cas Anvar, Juliet Stevenson. The film is directed by Oliver Hirschbiegel.