Crown Prince Mohammed bin Salman issued a royal decree announcing the appointment of Princess Reema Bandar Al-Saud as the kingdom's ambassador to the United States, Al Arabiya reports.
Princess Reema holds a Bachelor of Arts degree from Mount Vernon College at George Washington University in the United States, the agency said.
She was the first woman to head the Saudi Federation for Community Sports and worked alongside the Education Ministry to include sports education for girls in schools. The crown prince is savvy enough to know that he has to smooth things over with the United States following the Khashoggi murder in the Saudi consulate in Istanbul as many American politicians continue to demand answers.
Also, as Saudi Arabia lifted a ban on women drivers last June, the move was overshadowed by the continued incarceration of a number of activists who first championed the right of women to drive, and who represented leading voices in women's rights activism in the country.
Princess Reema bint Bandar replaced Prince Khalid bin Salman, who was named the kingdom's vice defence minister.
Prince Khalid, a former fighter pilot, had been ambassador to Washington for less than two years.
Before his still unexpained death, the journalist was a columnist for the Post newspaper, where he frequently criticised the Saudi government.
Mark Francois, Tory MP and vice chairman of the ERG, told the BBC that "the prime minister will want to know why three members of her cabinet have made a decision to publicly decry government policy" and added that he thought it was "interesting that the chancellor has not signed the letter".
While members of Congress have pursued measures to hold Crown Prince Mohammed bin Salman responsible for the killing and to cut military aid to the Saudi war in Yemen, President Donald Trump has stood by the kingdom, seeing it as a valuable Middle Eastern ally and reliable buyer of U.S. weapons.
After giving conflicting explanations of what happened, the Kingdom eventually admitted Khashoggi, who was once a Royal insider, was murdered after entering the country's consulate in Istanbul past year.
Princess Rima, the daughter of a former long-time ambassador to the USA, has been a leading advocate of female empowerment in the kingdom, which has faced intense criticism over the recent jailing of women activists - and subsequent claims of sexual abuse and torture of some of them in detention.
In a tweet, Prince Khalid said his posting would allow him to again "be the sword" of the defense minister.
A key challenge for Princess Rima will be to win over U.S. lawmakers, who earlier this month voted overwhelmingly to end American involvement in the Saudi war effort in Yemen, dealing a rebuke to President Donald Trump who has publicly thrown his support behind the crown prince.
The princess comes from an entrepreneurial background, and has chaired and co-founded a series of initiatives since she returned to Saudi Arabia in 2005, the National reported.