The rapper is said to have brought 50 friends and colleagues to the south of France, and hopes to treat them all to the festival's main events.
"Diddy has been a regular at Cannes over the years and is always welcome," a source told The Sun.
"However, this year he's arrived with more people than normal, which has proved a bit of a headache to the people in charge of the guest lists.
"Diddy is good value, though, and his bar bill always makes an interesting read."
Wes Anderson's latest film Moonrise Kingdom - starring Bruce Willis - opened the Cannes Film Festival yesterday (May 16) for its world premiere.
P Diddy recently beat Jay-Z to be named hip-hop's wealthiest artist by Forbes.
Watch the video for 'Coming Home' by Diddy-Dirty Money below: