Princess Diana's Iconic Black Sheep Sweater Sells for Record $1.1M at Auction

The famous garment, worn by the late Princess of Wales in 1989, was auctioned off by Sotheby's in New York on Thursday

Princess Diana's iconic black sheep sweater is breaking records.

On Thursday, the garment sold for $1.1 million at Sotheby’s latest Fashion Icons auction during New York Fashion Week — marking the highest price paid at auction for an item worn by the late Princess of Wales.

According to a press release from Sotheby's, the sweater sold for a total of $1.143 million, with bidding jumping from $190,000 to its final price after a 15-minute bidding battle. The knit was offered with an estimate of $50,000 to $80,000.

The garment broke the record set by Diana’s Victor Edelstein aubergine evening gown, which made fashion history when it sold for $604,800 in January. The dress, which was designed for Diana in 1989 and also auctioned off by Sotheby’s, fetched five times the pre-estimate.

Sally Muir, co-founder of Warm and Wonderful, tells PEOPLE exclusively that she was with her designing partner Joanna Osborne when the news broke.

"I went to Jo’s for the last two hours of the auction, and we had bucks fizz and sat down with some friends of hers and watched it," she says. "Nothing happened for hours, and then it all went berserk in the last 10 minutes. It was nail-biting because it had been stuck at the same level at around $180,000 all day, which we thought was brilliant, and then it just went mad. Everyone just screamed every time it went up!"

Muir added that she's "absolutely dying to know" to know who bought the piece. "But it’s all confidential unless it goes to a museum and then we might find out. It’s kind of frustrating but also quite intriguing because of course we have been speculating!"

Asked what Princess Diana would think of the sale, Muir says she would be "quite amused by it: it’s just the power of Diana, it goes on and on."

Related: How Princess Diana's Glamorous Gown Heading to Auction Showed She Was the 'People's Princess'

Sotheby’s announced the iconic sweater was going up for auction in June. Diana famously wore the garment with a pair of blue jeans as a 19-year-old to watch the then-Prince Charles play a polo match in June 1981, just a month before their royal wedding at St Paul’s Cathedral in London.

“It’s an obvious metaphor for not quite fitting in. But also, that it’s okay to stand out and be different," Cynthia Houlton, Sotheby’s Global Head of Fashion and Accessories, said of the sweater ahead of the auction.

The item was discovered in storage over 40 years later by one of the designers of the British knitwear brand Warm & Wonderful who created the fashion statement.

Soon after Diana first wore the design, Muir and Osborne received a letter from Buckingham Palace saying that Diana had damaged the sweater and asked if it could be repaired or replaced. A new garment was sent and the original, damaged item was forgotten about until Osborne came across it in storage earlier this year.

Related: Princess Diana's Statement Dress Is Up for Auction — and It's by Designer of Queen Camilla's Coronation Gown

“I was in the attic in February searching for a pattern, and I just happen to notice this old wine box in a corner — and there was a red sheep jumper wrapped in a cotton bedspread. It was well preserved, and I had a kind of Groundhog Day moment and thought, 'Could this be the one?' I looked at the cuff which had obviously been sewn back on, and I called Sal and said, 'I think I’ve found the actual real Diana jumper!’ ” Osborne exclusively told PEOPLE.

“We had just sort of forgotten about it,” added Muir.

Osborne continued, “We looked at all photographs of her wearing it, and we compared the two and we both felt certain that it was the actual one. We just knew because every jumper is different, so it was easy to see. So we called Sotheby's!”

Ahead of the auction, Houlton also exclusively told PEOPLE that the way in which the garment was re-discovered raised the stakes for the sale.

“They very randomly came across this sweater, it's not like they were sitting on this sweater for some period of time and then decided who they should sell it to,” Houlton said of Muir and Osborne.

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Diana wore her second version of the sweater for another one of Charles’ polo matches in 1983, teaming the item with a white blouse with a black bow and white pants.

Last week, three of Diana’s gowns were also sold at auction for around $1.62 million.

The fashions were up for auction at Julien’s Auctions and Turner Classic Movies Presents “Legends: Hollywood and Royalty,” which was held from Wednesday to Friday in Beverly Hills and online.

The items sold included a red silk Bruce Oldfield gown and two designs by royal favorite Catherine Walker. The first was a black silk velvet and white silk strapless gown, while the second was an off-the-shoulder dress with a black bodice and green silk skirt.

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