Princesses Beatrice and Eugenie are feeling "hurt and humiliated" over Prince Andrew's sex scandal.
The Duke of York is alleged to have had intercourse with an under-age woman, Virginia Roberts, and his daughters are feeling embarrassed and ashamed about the accusations, despite Buckingham Palace insisting they are "categorically untrue".
A source said: "It's really the worst thing imaginable for them. They just want to hide away and not see anybody."
Eugenie, 24, is believed to be taking the allegations particularly badly, telling pals she feels like the whole situation is a nightmare.
The source continued: "Eugenie said she woke up the other day and hoped it was all a bad dream."
While the 54-year-old royal's daughters feel upset over the claims, the Duke's former wife, Sarah, Duchess of York, is thought to be standing by her ex-husband and friend, with whom she recently purchased a multi-million pound chalet in the exclusive Verbier resort in Switzerland.
The insider said: "She'll defend Andy until the day she dies."
Although she has come out in support of the Prince, the Duchess is reportedly furious he became involved with American investment banker Jeffrey Epstein in the first place, as he is who is believed to have "loaned" the woman to him.
Speaking to Woman's Day magazine, the insider added: "She's still angry with him for putting himself in these bad positions, and for the pain it's caused Bea and Eugenie."
Tagged in Sarah Ferguson Princess Eugenie Princess Beatrice