He wore a slick black suit. She wore a midnight blue velvet gown by couturier Victor Edelstein with a sapphire and pearl choker, an outfit that has since become emblematic of the princess.

Dress Princess Diana wore to dance with Travolta auctioned off

"There are three iconic images of Diana: this dress, the wedding dress, and the 'revenge dress,'" said auctioneer Kerry Taylor, referring to the off-the-shoulder Christina Stambolian dress Diana wore the night Prince Charles publicly acknowledged his infidelity.

The blue Edelstein gown will go under the hammer on December 9 at Kerry Taylor Auctions, where it is expected to fetch up to £350,000 (about $388,000).

It last sold at the same auction house for £240,000 ($311,000) in March 2013, to a British buyer who bought the dress as a gift for his wife, Taylor said.

Taylor believes interest has only intensified since then, not only because the dress belonged to Diana, but because of the moment it represents.

"Here was this beautiful young woman, dancing with this Hollywood star. She was in awe of him, he was in awe of her. Two beautiful young people, carefree, dancing with the eyes of the world upon them."

That evening, Charles and Diana still appeared to represent the "fairytale" royal romance, Taylor explained. "So it became one of the most important moments for Diana in the public eye."

Princess Diana and Prince Charles attended the White House dinner on the first night of their royal tour of the US, alongside famous guests including Travolta, Neil Diamond, Leontyne Price, Tom Selleck, Gloria Vanderbilt, Estée Lauder, Clint Eastwood and Mikhail Baryshnikov.

Diana personally requested the invitation of Travolta, Eastwood and Diamond, the Washington Post reported at the time. "I'm so nervous my stomach is all butterflies," Diamond told the newspaper. "I'd rather face an audience of 20,000."

Travolta later told ABC News that it was one of the highlights of his life.

After Diana and Charles divorced in August 1996, Diana renounced some of the glamour of her royal life, as she intensified her focus on humanitarian work.

In June 1997, two months before her death in a Paris car crash, she donated 79 elaborate gowns to be auctioned at Christie's for charity -- including the blue velvet Edelstein dress.

"Of course it is a wrench to let go of these beautiful dresses," Diana told Vanity Fair. "However, I am extremely happy that others can now share the joy that I had wearing them."

The magazine called the auction a "metamorphosis" for the Princess in an article titled "Diana Reborn," opining, "She is jettisoning a life that never was."

Of all the gowns, the Edelstein dress attracted the highest bids, selling for $222,500, a new record for garment sales at Christie's, the New York Times reported.

The previous record of $145,000 had been set by none other than the polyester white suit Travolta wore in "Saturday Night Fever."

This time, Taylor expects an American buyer to win the dress. "This dress is huge in America," she said.

"She wore it at the White House with the Reagans, so for an American collector, this is the key piece."

It's likely to be a good investment, too. "There's still a huge interest in Princess Diana which cuts across all age groups," Taylor added. "The interest in the princess is increasing, not declining."

Two other Diana dresses are being auctioned the same day, for much more modest prices.

A blue velvet Katherine Cusack evening gown the princess wore to the Royal Academy concert in 1986 is expected to sell for up to £30,000 ($39,000). And a Catherine Walker navy wool day dress is estimated to fetch £6,000 ($7,700).