The 23 -year-old actor is thought to have called off his engagement with Harry Potter actress Bonnie, who played Ginny Weasley in the saga based on Jk Rowling's novels - and was spotted holding hands in Toronto, Canada with Lily recently.
An insider told Us Weekly magazine: ''Bonnie and Jamie split a while ago. It was amicable, but things had not been going right for some time. It's sad.''
The former couple got engaged in April 2011.
Jamie and 21-year-old Bonnie rarely spoke publicly about their relationship and the pair first confirmed they were a couple at the BAFTAs in February 2010, although they had been dating since 2009.
Bonnie told a reporter: ''Yes, we're dating. We've been seeing each other for a few months, it's good.''
It would not be the first 'Twilight Saga' star Lily - the daughter of music artist Phil Collins - has dated.
Before her rumored romance with seeing her 'Mortal Instruments' co-star Jamie, she encountered a brief relationship with actor Taylor Lautner, who also stars in the vampire series.