The Sun reports that the incident took place during a party at the Royal Lodge in Windsor, the home of her father who was away at the time.
The You’re Beautiful hit maker reportedly joked to the Princess that he would love to be Sir James, and she supposedly obliged.
"The blade cut into his face and it was just a few inches from his right eye," a source told the newspaper.
While the story seems a little odd (but at the same time hilarious) there has been no official comment from any of the parties, except the gash on Ed’s face does suggest something went down.
We can only imagine the royal serving Beatrice will receive from the Queen over this one.