The diagnosis comes just days after her son Frederik and daughter-in-law Mary marked the Tasmanian-born royal's 50th birthday in a private family celebration alongside their children, Prince Christian, 16; Princess Isabella, 14; and twins Prince Vincent and Princess Josephine, 11.
A gala celebration had been planned to celebrate the milestone as well as Mary's tireless dedication to the crown in the past 18 years but was cancelled due to rising coronavirus case numbers in Denmark.
"Frederik and his mother, together with Mary's kids, had been working for months to plan an amazing gala dinner for her 50th," a source told Woman's Day.
"They planned an epic degustation menu, music, dancing, and Fred had already put the finishing touches on a beautiful speech."
Hundreds of guests, including European royalty, Mary's Aussie siblings and her Scotland-based dad were due to fly into Copenhagen for the glamorous event within the historic Rosenborg Castle.
Prior to contracting COVID, the Queen had also undertaken a slew of commitments to celebrate her own momentous milestone - her Golden Jubilee celebrations to mark fifty years on the throne.
While many of the scheduled events were postponed from January to September due to the pandemic, Margarethe joined wreath-laying ceremony at Roskilde Cathedral on the 50th anniversary of her father's death alongside her sister Princess Benedikte, as well as her two sons, Prince Frederik and Prince Joachim, and their wives, Princess Mary and Princess Marie.
The Dane was also surprised with a "secret dinner" organised Mary and Frederik, which was attended by her closest family members.
WATCH: Princess Mary pretty in pink as she curtseys to Queen (Article continues after video)
"On the occasion of her 50th Government Anniversary, Her Majesty the Queen was surprised tonight by the immediate family with a secret dinner in Christian VII's Palace at Amalienborg," a social media post said.
It comes after Princess Mary was also diagnosed with COVID back in December, with her first public appearance since her recovery being the Queen's Golden Jubilee commemorations.
Prince Christian, the future king and Princess Mary's older son, tested positive for the virus in December 2020 after an outbreak at his school.