A source said: “She and Harry have been in touch for around a year, but they first kissed about nine months ago.
“Things went cold for a while, but they hooked up on Thursday night and ended up spending the night together.
“They are both young and attractive and they really enjoy each other’s company. There’s great chemistry between them. They are definitely planning to see a lot more of each other over the next few weeks.”
Harry - who has dated a number of older women, including DJ Lucy Horobin and presenter Caroline Flack - reportedly shared a kiss with Caggie last October but she didn't want to take the romance any further as she was concerned about him being five years younger.
The source added: “It was obvious Harry had a bit of a thing for Caggie because he started tweeting her before they had ever even met.
“And when they actually saw each other in person they hit it off straight away. There was obviously real chemistry between them.
“They swapped numbers and stayed in touch, but nothing happened at first. At the time Caggie was busy on 'Made In Chelsea' and Harry was promoting One Direction’s debut single, 'What Makes You Beautiful'.
“About a month later they had a really nice evening round at Caggie’s, but she was determined to take things slowly.
“Then Harry met Lucy Horobin when he was on her radio show and they ended up having a three-month fling. But when that ended in October, Harry and Caggie met up on an evening out and ended up kissing.
“Things didn’t really go any further than that because Harry got with Caroline Flack and then went straight off on the One Direction world tour.
“They stayed in contact and when he got back a few days ago they arranged to hook up.
“They met up at Dorsia and had a really great night together. They plan to see a lot more of each other whenever both their busy schedules allow.”
Caggie - whose real first name is Catherine - previously confessed in her newspaper sex column that she liked the idea of dating a younger man.
She wrote: “I wouldn’t be surprised if one day I became a cougar. Personally, I find these glamorous, sexually-confident older women seriously appealing.”
However, a spokesperson for Harry insists he is not dating Caggie.
They said: “Harry and Caggie are not dating and are not romantically involved.”