The correspondence, which covers a 20-year period from her Hollywood days to her marriage with Prince Rainier III of Monaco, reveals hitherto unpublished details about her love life, her battle with alcohol and some of her raunchier escapades with Hollywood's leading men.
The letters, which experts have valued at more than dollars 100,000 ( pounds 670,000) were written to her girlfriend and personal secretary, Prudence Wise, and have been sold to a dealer in Los Angeles by one of Ms Wise's relatives for an undisclosed sum.
One of the more remarkable was written in 1953 while Grace Kelly was in East Africa filming John Ford's Mogambo, in which she co-starred with Clark Gable. 'Yesterday we had a day off,' she wrote. 'Clark and I rode in a jeep for three hours to get to Bukoba, the nearest town on Lake Victoria. We had a horrible lunch . . . then a delicious swim in the Lake. We had to go in in our underwear. It was a riot as you can well imagine . . . '
At one stage the pace of drinking during the making of the film, which also included Frank Sinatra and Ava Gardner, appears to have become too much for her. 'There was a terrible champagne binge for about 10 days over Christmas and a few smaller onces since,' she wrote. 'Sunday we all went on the wagon until Rome. Ava and I are now great pals. She wants me to stay with her in London. But oh, so neurotic]' But Sinatra's volatile temper apparently proved a problem: 'Frank left Friday, so maybe things will easier.'
The letters also confirm that Princess Grace, who has been the subject of numerous biographies, was secretly engaged to the world-renowned fashion designer, Oleg Cassini, before her marriage to Prince Rainier. Mr Cassini claimed as much in his autobiography, but was widely disbelieved. But Grace Kelly wrote, on Hotel Bel-Air stationary: 'My father isn't very happy with the prospect of Oleg as a son-in-law . . . '
Princess Grace, who was killed in a car accident in 1982, has long been said to have had love affairs with some of Hollywood's biggest names, including Gary Cooper, Cary Grant, Bing Crosby and David Niven. But, according to Terry Kinsella, whose company owns the collection, her letters indicate only that she had warm friendships with them. The only suggestion of romance is with Clark Gable.