Infanta Pilar, elder sister of King Juan Carlos, is the first member of the king's family, to comment on the abdication.
Although the news surprised most Spaniards, Infanta Pilar told a television reporter that she knew for several days before the announcement, but was told not to speak about it.
"I have absolute loyalty to the Crown and Spain, or rather to Spain and the Crown because the country comes first."
Members of the King's inner circle, including other Heads of State, were told of the King's decision to abdicate several days ago.
Infanta Pilar believes her nephew, Felipe, is "divinely prepared" for his new role. " She added that her brother is "fine."