The 24-year-old pop star has agreed to marry Young, whom she has been dating since October 2013, after the Los Angeles Lakers player proposed at his 30th birthday party on Monday.
Video footage of the proposal has already surfaced online, and showed the sportsman get down on one knee to ask: "Would you marry me?"
Azalea instantly said "yes", leading the guests at the party to cheer.
Young presented the "Fancy" hitmaker with the ring, which features a 8.15 carat fancy intense yellow cushion cut centre stone with 2.28 carat of white diamonds set onto 18 carat white gold.
The proposal came just a day after Young said "of course" marriage was on the cards for the couple at some point.