Take it from an ex-diplomat's wife: cocktail with an ambassador? Chic, chic, chic. Think that there could be pictures taken. Remain modest (avoid plunging décolletés, above-the-knee hems, etc). Because of the pictures that later circulate. Silk blouse (not too open, of course), pearls, midi length pencil, dainty heels, chic, not too businessy topper - such as a very beautiful pashmina, or a well cut structured jacket... try not to sport anything too out of the ordinary, like an oversize scarf in a vibrant color... because these events err more on the conservtive side. You didn't mention what country the ambassador was from? This could have an impact on what you should wear or avoid to wear. For example, I would refrain from wearing jewelry that has any type of religious connotation - such as a small cross - if the ambassador is from a muslim country.
It's not intolerance here, it's a question of diplomacy between his culture and yours. You don't want to start anything with what you are wearing. When I was going to functions in the muslim country where we were posted, I would absolutely ban any type of religious or symbolic designs as it could have been interpreted as a desire to convert locals to my religion (it wasn't the case of course but the possiblity of being seen that way was very real). For you, it wouldn't be the case, but still, I would advise to refrain.
I just saw the picture above and it looks perfect for the occasion.
Also, is this event likely to take place outside - for example in the garden behind the diplomatic house? If so, I strongly recommend against heels that are too thin as they will sink into grass.