While the image itself was commissioned by the National Portrait Gallery, Bailey had kept the image himself all these years, hence why this is the first time it's been seen in public.
The exhibit, Life Through a Royal Lens features a number of portraits taken of the royals dating right back to Elizabeth I.
"For me, it is the most powerful of images from the sitting," curator Claudia Acott Williams said of Diana's portrait.
Per PEOPLE, Diana wanted Bailey to capture her profile because of his, "bold minimalism". She believed this would help establish a new identity for herself in photographs.
It certainly differs from some of the softer, coloured professional photographs that were taken of the Princess in the 1980s. Diana, who was was shy by nature, was often snapped in bright clothing in natural landscapes, either in her Kensington Palace garden or at her and Princes Charles' country estates.
In stark contrast, Bailey's image features the Princess unsmiling, determined, empowered. Just the way Diana wanted it to be.
Life Through A Royal Lens runs from March 4 to October 30 at Kensington Palace.