Royal sources claim the "Fab Four" split because Prince Harry accused his brother and sister-in-law of not supporting Meghan Markle.
According to The Mail On Sunday, Harry "read them the riot act" one evening after their children had gone to bed.
William and Kate were reportedly "caught off guard" by the rant, and Meghan maintained a "stony" silence throughout.
As the argument took place before Harry and Meghan's wedding, the pair were still living as neighbours at Kensington Palace - and Kate and William dropped off an apology bunch of flowers the next day, says The Mail's source.
The Duchess of Cambridge then reportedly offered to accompany Meghan to Wimbledon, as a peace offering.
Despite the olive branch - In June Kensington Palace confirmed the Royal Foundation charity was being split between the young royals, citing the couples' desires to focus on their own charity endeavours.
Royal commentator Duncan Larcombe said the move demonstrates that Meghan, 37, and Prince Harry, 34, intend to "do things their own way".
"It does seem odd. Why separate when you are both backing the same causes? Whether this is a sign of a rift, this is certainly a sign of a division," Larcombe told Fabulous Digital.
Prior to the birth of their first child, Archie, Harry and Meghan also moved away from Kate and William's home at Kensington Palace.
"Things did get very bad between the brothers and they didn't see each other privately for a number of months after the royal wedding," a royal source told The Sun at the time.