The 49-year-old 'Cougar Town' actress recently accompanied McDaid to Jennifer Aniston's Christmas party after meeting through mutual friend Sheeran, reported Contactmusic.
"Ed decided to set them up. They got on amazingly and have been dating ever since," a source said.
The actress was reportedly upset following her divorce from David Arquette, who she split from in 2010 after 11-years of marriage.
However, she is a lot happier now.
"Johnny came along at the right time. Courteney is happier than ever," the source added.