Reports after the auction by Waddington's said all of the dresses had sold for about $3 million, but news later emerged only three were purchased at the auction and one afterwards, the Star said.
The auction house said it doesn't comment on their clients or auction results, but a source told the newspaper the reserve, or minimum, prices set for the dresses by the owner was too high.
The collection was purchased in 1997 by Florida businesswoman Maureen Rorech Dunkel, an acquaintance of Diana. Since, she has toured the collection to raise money for charities Diana supported. Two months after Dunkel purchased the dresses at a New York auction, Diana was killed in a Paris car crash.
Last year, Dunkel filed for bankruptcy and was apparently trying to liquidate the collection as part of the bankruptcy process.
The newspaper said there was no indication which dresses sold or for how much.