The Princess cut is the second most popular cut shape for diamonds, next to a round brilliant. The face-up shape of the princess cut is square or rectangular and the profile or side-on shape is similar to that of an inverted pyramid with four beveled sides. The princess cut is a relatively new diamond cut, having been created in the 1960s. It has gained in popularity in recent years as a more distinctive alternative to the more popular round brilliant cut, in which the top of diamond, called the crown, is cut with a round face-up shape and the bottom, called the pavilion, is shaped similar to a cone. A princess cut with the same width as the diameter of a round brilliant will weigh more as it has four corners which would otherwise have been cut off and rounded to form a round brilliant. The princess cut is sometimes referred to as a square modified brilliant. However, while displaying the same high degree of brilliance, its faceting style is unique and completely different from that of a round brilliant. The Princess cut had its origins in the early "French" cut, having a step-modified "Double-French" or "Cross" cut crown and a series of unique, chevron-shaped facets in the pavilion which combine to give a distinct cross-shaped reflection when the stone is viewed directly through the table. Effectively, the Princess cut combines the high degree of light return of a round brilliant cut with a distinctive square or rectangular shape.

The square princess cut diamond is usually slightly cheaper than round brilliant cut diamonds of the same carat weight because it retains about 80% of the rough diamond, as opposed to the round brilliant which retains only about 50% of the rough. The ability to retain more crystal weight makes this shape popular amongst diamond cutters.