William and Harry to hold Diana concert at new Wembley

The Mail on Sunday has learned that the live show will take place on Sunday, July 1, Princess Diana's birthday.

Stars who could appear include Beyonce, Kylie Minogue and Madonna.

The new stadium is due for completion in June 2007. The venue, costing £757million - double the initial estimate - and 15 months past its original deadline, is in desperate need of a spectacular and flawless launch.

It is understood that the Princes hope that by celebrating their mother's life on what would have been her 46th birthday, the sting will be taken out of August 31 - the date on which she died in Paris.

Because next year is the tenth anniversary of her death, they are aware that the date is bound to resonate publicly more than ever.

An official announcement is due to be made on December 12 but plans for the concert were set in motion during the summer after a series of discussions with their Private Secretary, Jamie Lowther-Pinkerton, in which William and Harry expressed a desire to honour their mother's life and continue the legacy of her charitable work.

One well-placed source said: 'The Princes are very excited about it.

'They are very hands on, organising and helping to select their favourite bands. It is going to cause a stir. This is a major new happening with regard to the Princes' emerging public profile.'

Indeed, the list of artists being invited to appear reflects the Princes' youth. The Killers, rapper Pharrell and Beyonce have all been approached, along with Madonna and Kylie as well as stars more reminiscent of their mother's tastes such as George Michael and Sir Elton John, who is said to have confirmed he will perform.

The source added: 'Prince William is mad about Beyonce and Prince Harry wants Pharrell.'

Artists are being approached through their managers rather than record companies, and are being asked to waive their fee for the concert, which will be held in aid of a children's charity in Africa.

It is thought that at least some of the funds raised will go towards Harry's charity Sentebale (forget-me-not), established by the Prince along with Prince Seeiso of Lesotho to raise money for orphans and fight HIV and Aids in the impoverished African kingdom. It is a cause that was close to Diana's heart.

The boys' plans are understood to have the full backing of Prince Charles and the proposed concert is being viewed by some as a natural successor to Charles's hugely successful Party in the Park.

Launched in 1998, that annual rock concert has raised millions for the Prince's Trust but was cancelled last year to make way for Sir Bob Geldof's Live8 and did not take place this year amid reports that the event was failing to attract big names.

Officials at Clarence House are understood to be involved in negotiating the logistics of the four-hour musical extravaganza at Wembley.

They are working in conjunction with Florida-based events firm Live Nation, a company that has a solid track record and has helped stage many of the Prince's Trust's Hyde Park concerts. It is also used to dealing with the sort of fierce bidding for worldwide media rights that such an event is bound to attract.

Paddy Harverson, Charles's communications secretary, said: 'A number of ideas are being looked at for next year but for the time being no confirmation has been made.

'I wouldn't want to go into any more detail because discussions are ongoing.'