It is NOT required for both individuals to be Catholic to be married by a Priest... My wife and I are currently attending pre-marital classes to be married in the church by a priest and my wife is Baptist... We were previously married outside of the church by a Justice of the Peace, because I was misinformed by someone who told me that both had to be Catholic... After being married for a couple of years we had a child and we wanted him baptized in the Catholic church...while meeting with the Priest on that subject he informed us that we could have our marriage blessed in the church and that we could have been married in the church to begin with...

It is not required today though at one time it was. The Church recognized that two people who were Catholic would have an easier time raising children to be Catholic while if one was of another faith, it would be more difficult., The Church still requires that children be rasied in the Catholic Faith, but allows for inter-denominational marriages to take place. Here is the Catechism's answer to the question.... 1634 Difference of confession between the spouses does not constitute an insurmountable obstacle for marriage, when they succeed in placing in common what they have received from their respective communities, and learn from each other the way in which each lives in fidelity to Christ. But the difficulties of mixed marriages must not be underestimated. They arise from the fact that the separation of Christians has not yet been overcome. The spouses risk experiencing the tragedy of Christian disunity even in the heart of their own home. Disparity of cult can further aggravate these difficulties. Differences about faith and the very notion of marriage, but also different religious mentalities, can become sources of tension in marriage, especially as regards the education of children. The temptation to religious indifference can then arise. 1635 According to the law in force in the Latin Church, a mixed marriage needs for liceity the express permission of ecclesiastical authority.135 In case of disparity of cult an express dispensation from this impediment is required for the validity of the marriage.136 This permission or dispensation presupposes that both parties know and do not exclude the essential ends and properties of marriage; and furthermore that the Catholic party confirms the obligations, which have been made known to the non-Catholic party, of preserving his or her own faith and ensuring the baptism and education of the children in the Catholic Church.137