Nature has identified each diamond by natural "inclusions": crystals, feathers, lines,etc. These traits are developed in the diamond during its formation.
Diamond clarity is determined by the absence of these inclusions. The fewer the inclusions, the rarer the diamond and the greater the value. Flawless and internally flawless diamonds are exceedingly rare. The term "flawless" is a highly restricted one. Under Federal Trade Commission rules a diamond can only be deemed flawless when no internal or external imperfections are visible to a professional eye under 10 power magnification using a binocular microscope in good light. While inclusions may not affect the beauty of a diamond, they do affect its value and price.