Talk to him out of respect. Tell him what's up and let him know you mean him no disrespect. It's not your fault she likes you. Tell him he should respect you for coming to him to let him know how you both feel. If you dont want to lose your pal over a girl you just me, let him make the call. Once he has this info, he probably wont want to be with the girl, then I'd not date her unless he tells you to go ahead.
"Oh Lord it's hard to be humble, when you're perfect in every way. I can't wait to look in the mirror, cause I get better loking each day. To know me is to love me, I must be a hell of a man. Oh Lord it's hard to be humble, but I'm doing the best that I can." Mac Davis