The 22-year-old appeared on the BBC Radio 1 show, "Breakfast with Greg James" when she finally spilled the tea and personally apologized to William and Kate.
Radio host Greg James started to tell the story on air before Camila cut him off and jokingly said, "Don't tell anybody what my mother and I did."
James continued his story after laughing off her funny threat.
"We're in Kensington Palace for the teen heroes. We're about to meet William and Kate, and I said, 'You've got to steal something. Steal something!' And I said, 'Steal that pencil,'" the BBC radio host said.
Camila responded, "I was like, 'You triple doggy dare me?' ... And you can't not do a triple doggy dare. If there's anything I've learned in my life, it's that. So, I did it."
The pop star exclaimed that James actually ratted her out to a palace staffer.
"I was like, 'Oh, my God.' And I put it in my mom's purse, and my mom was like, 'No, we have to give it back. We have to give back the pencil.' And I was like, 'No, he triple doggy dared me. I have to take the pencil,'" she recalled. "So, I still have it. I'm sorry, William, and I'm sorry, Kate. I honestly couldn't sleep last night. I had to get it off my chest."