Diamonds are formed under very specific conditions that require materials bearing carbon to be exposed to high pressure though low temperature (relative to most parts deep inside the earth.) The pressure should be somewhere at least 45 kilobars and the temperature a minimum of 1652 degrees Fahrenheit. There are only two situations that provide these settings in the Earth. They are at the site of a strike by a meteorite or in the earth’s lithospheric mantle and where it is below continental plates that are relatively stable. Diamonds are only formed deep inside the earth, at least 90 miles down, to a maximum of 120 miles deep. Of course, this depends on the geographic area as the rate of temperature change relative to depth is different in different regions. Under oceanic plates, for example, the temperature will rise more quickly as you go deeper in the earth. The only place where you will find just the right combination of pressure and temperature are the oldest, thickest and most stable parts of the earth’s continental plates where lithosphere regions called cratons are found. The longer the diamond crystals reside in the cratons the larger the diamonds that result. The carbon that we find in diamonds comes from a combination of both organic and inorganic matter. Scientists have determined this by studying ratios of carbon isotopes, a method somewhat akin to carbon dating. Some diamonds, called harzburgitic, have been formed from carbon that is inorganic and found in the deepest parts of the earth’s mantle. Eclogitic diamonds, in contrast, contain organic carbon that comes from organic detritus being pushed by subduction from the surface of the earth. Diamonds that rise to the surface of the earth are at least one billion years old and may be over three billion years. Sometimes diamonds form in other events that also have high pressure and low temperature settings. Nanodiamonds and microdiamonds, the very smallest of the diamond family, have been discovered inside impact craters, the result of meteors striking the earth. The shock of the meteor strikes actually creates the ideal temperature and pressure conditions that create these diamonds. Source: http://en.wikipedia.org/wiki/Diamond