GIA's official definition:

The clarity of a diamond pertains to the stones relative position on a Flawless to Imperfect scale. Clarity characteristics can be either internal (inclusions) or external (blemishes). The size, number, position, nature, & color or relief of the imperfections determine the clarity grade.

Some personal comments

As you'll be observing diamonds on this site under a 10x-63x microscope (which will revolutionize the way you look at diamonds) keep in mind that there are 4 words running through the head of a gemologist as he observes a diamond under magnification. Those words are "minute", "minor", "noticeable" & "obvious".
 

The description of these imperfections as we observe them under the scope will determine what clarity grade the stone falls within. Here's a simple breakdown.

Some words about the microscopic pictures you'll be viewing

When pictures are taken of diamonds under the microscope the pictures are taken in what's called "darkfield illumination".  Darkfield illumination means that the diamond is placed at the top of a cylindrical source of high intensity light with the bottom of the "well" being covered by a flat black baffle.  The light is concentrated onto the pavilion facets which in turn "lights up" the inclusions on the interior of the stone.  For the critical analysis of diamonds this is extremely important to properly determine a diamonds clarity grade. The darkfield illumination is lighting up the tiny feather at 3:00 which helps us identify this VS1 clarity diamond.

One thing you must keep in mind is that when you're viewing a diamond under darkfield illumination, this is not realistic to how the diamond actually looks.  When John Q Public is looking at your diamond he is looking at it under conditions of "overhead" lighting.  As of October 2000 I've been showing pictures of diamonds under BOTH darkfield illumination AND overhead lighting in the "For Sale" section. Here's why.  Notice these feathers under the table in an SI2 clarity diamond shown under darkfield illumination.

Now look what happens when we turn off the darkfield illumination and turn on the overhead lighting.

The inclusions which were once lit up have now virtually disappeared. These pics are taken at about 30x magnification too.

Ok, enough words, lets see some more pics of these things!!! Click on one of the clarity grades on the top of the page to observe what these babies look like under a scope! Or, simply, click on "Next Page". Oh, and don't forget to check out How to Properly Use a Jeweler's Loupe. Explore and have fun!