Iolite is a popular and interesting gemstone. It has a pretty violet blue color that is unlike other gemstones, although it has been compared to a light blue sapphire. It is this reason that it is sometimes known as "water sapphire". Although the color is attractive and popular it is not extremely rare and therefore affordable.

Pleochroism is very pronounced in iolite and is seen as three different color shades in the same stone. In the viewing an iolite stone, the colors violet blue, yellow gray and a light blue can be seen, all a result of pleochroism. Tanzanite is a blue-violet gemstone variety of the mineral zoisite, has strong pleochroism as well and can be easily confused with iolite. However, tanzanite is usually more strongly colored, its pleochroic colors vary from dark blue, green-yellow and red-purple and it has greater fire.

The major sources of gem grade iolite come from Sri Lanka, India, Madagascar and Burma.