The odds on her having a baby boy are now 6-4, while Alexandra still remains the hot favourite to be the chosen name for the future heir at 7-4.
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In what has been the biggest non-sporting betting event in the history of bookmakers Coral's, other markets include the colour of the baby's hair, with brunette the 13-8 favourite, and the weight of the baby, with 7lbs to 7lb 15oz the favourite.
"The whole world has been waiting for Kate to go into labour and now that she has, we have witnessed another betting frenzy," said Coral's spokesperson Nicola McGeady.
"Punters have been anxiously clutching onto their betting slips for months now and if the money talks, the baby will be called Alexandra, with brown hair, weighing 7lb to 7lb 15oz, an outcome which will prove a nightmare result for the bookies."
Kate was admitted to St Mary's Hospital in Paddington, London in the early stages of labour. Kensington Palace confirmed the news early on Monday morning, revealing that the Duchess had travelled by car from Kensington Palace to the Lindo Wing with her husband Prince William by her side.
At around 6am on Monday, a royal convoy was spotted arriving at the hospital's rear entrance, and at 7.30 the statement was issued confirming the news the world has been waiting for.
Kate and William have never revealed their baby's due date, but it is widely thought that their firstborn is overdue. The fact that the Duchess arrived by car, and not by ambulance, would suggest that she has gone into labour naturally.
The nation must now patiently await the arrival of the royal baby, which will be delivered by the Queen's former gynaecologist Marcus Setchell and the Queen's current gynaecologist Alan Farthing. It is highly unlikely that there will be any updates during the labour stages, with the first sign that the child has been born being the exit of a royal official from the Lindo wing.
As soon as the new Prince or Princess has made their grand entrance, an official announcement will be signed by Kate's doctors. It will be driven to Buckingham Palace, probably with a police escort. Only then will the public find out the sex, weight and possibly the name of the Queen's third great-grandchild.
The world's press has been camped outside the hospital for well over a week now, and excitement is at an all-time high following the news that the Duchess is now in labour. In scenes that echo the feverish atmosphere surrounding William's birth, followers of the royal family have also joined the throngs.
It has been reported that Kate will spend the first few weeks following the birth at the home of her parents Carole and Michael to give her the privacy and support she needs during this special time. The Middletons' £4.85million Georgian home is situated in the quiet Berkshire village of Bucklebury.
Watch all the action from outside the Lindo Wing as the world awaits news of the arrival of the Prince or Princess