Prince Harry and his wife Meghan, the Duchess of Sussex, will no longer be allowed to call themselves 'His Royal Highness' or 'Her Royal Highness'.
Buckingham Palace says the pair also won't be allowed to formally represent the Queen, and will have pay back money they were given to refurbish their home in the UK, Frogmore Cottage.
It was revealed earlier this month the pair wanted to step back from their duties as royals and do their own thing, splitting their time between North America - where Meghan is from - and the UK.
"Following many months of conversations and more recent discussions, I am pleased that together we have found a constructive and supportive way forward for my grandson and his family," Harry's grandmother Queen Elizabeth II said on Sunday (NZ time).
"Harry, Meghan and Archie will always be much loved members of my family.
"I recognise the challenges they have experienced as a result of intense scrutiny over the last two years and support their wish for a more independent life.
"I want to thank them for all their dedicated work across this country, the Commonwealth and beyond, and am particularly proud of how Meghan has so quickly become one of the family.
"It is my whole family’s hope that today’s agreement allows them to start building a happy and peaceful new life."
As a part of the new arrangement, Harry will step back from his military appointments - including titles he inherited from his grandfather Philip when he retired - and no longer get any money for public duties. They'll keep their private patronages and associations, and have sworn that "that everything they do will continue to uphold the values of Her Majesty".
They won't use their HRH titles, and will "repay Sovereign Grant expenditure for the refurbishment of Frogmore Cottage, which will remain their UK family home", which they will pay rent on.
UK tabloids reported on Saturday that Elizabeth was "privately unhappy" with the pair's move, after the taxpayer funded a $4.7 million refurbishment of Frogmore Cottage, where they lived rent-free.
ITV royal correspondent Chris Ship reported they pair will still get money from Prince Charles' income stream from the Duchy of Cornwall, and Harry will remain a prince.
The changes will kick in from 'spring 2020', which is autumn here in New Zealand.
This is breaking news - more to come.