Kate's due date
The Duchess is believed to be around 13 to 14 weeks pregnant and confirmation of the birth month means it is likely she has now had a routine 12-week scan.
"Their Royal Highnesses the Duke and Duchess of Cambridge are delighted to confirm they are expecting a baby in July," a St James' Palace spokesman said.
"The Duchess's condition continues to improve since her stay in hospital last month."
The announcement brings confirmation that Kate is expecting just one baby, following speculation she might have been carrying twins.
The Duchess has been suffering from hyperemesis gravidarum, which causes severe vomiting during pregnancy and is more often experienced by women expecting a multiple birth.
The condition is most common in the first 12 weeks of pregnancy and often eases off in the second trimester of pregnancy, which Kate is believed to be entering now.
Kate's pregnancy was announced earlier than planned on December 3 after she was admitted to King Edward VII's Hospital over the illness.
Sky News Royal Correspondent Paul Harrison said no specific due date had been revealed because traditionally a due month is announced, as was the case for Princes William and Harry.
He said: "July fits in with a lot of speculation recently - if you consider that you don't generally announce your pregnancy until 14 weeks.
"Kate and William had to because she was admitted to hospital in early December. It sits perfectly for a mid-July birth."
The new prince or princess could end up sharing a birthday with William's mother, the late Diana, Princess of Wales, who was born on July 1.
A spokesman for the couple said they were unlikely to undertake any engagements in the next few weeks because William would be concentrating on his flying with the RAF Search and Rescue Force.
He added that Kate was likely to return to engagements "in the near future".
However, once the due date draws near, any major trips - along the lines of their joint nine-day visit to Asia and the Pacific in mid-September of last year - are expected to be off the cards.
The Queen has acted to ensure the new arrival - a future King or Queen - will be entitled to be a princess if William and Kate have a daughter.
Under past rules, a daughter would have been styled Lady instead and not known as Her Royal Highness - only a first-born boy born to the Cambridges would automatically have become a prince.
The Queen has issued a Letters Patent under the Great Seal of the Realm declaring: "All the children of the eldest son of the Prince of Wales should have and enjoy the style, title and attribute of royal highness with the titular dignity of Prince or Princess prefixed to their Christian names or with such other titles of honour."