Clarity refers to how free a diamond is from naturally created "birthmarks", which are tiny, often microscopic imperfections that make each and every diamond unique. These tiny imperfections are refered to as "Inclusions" if they are found on the inside of the ring, and "Blemishes" if they are found on the outside. Inclusions and blemishes have little or no effect on the brilliance of a ring.
Diamonds are assigned clarity grades based on visible Inclusions that can be detected with ten-power magnification.
Here are the measures of stone clarity:
Flawless diamonds have no inclusions and are therefore extremely rare and also more expensive.
VVS1, VVS2
This grade will have the smallest inclusions. VVS1 inclusions can only be seen through the pavilion, while VVS2 inclusions are more visible, with VVS1 inclusions being much harder to see than VVS2.
SI1, SI2, SI3: will have small inclusions that are often only visible under a scope.
I1, I2, I3: have inclusions visible to the naked eye.
The chart below will help you understand the definition of clarity grades and give you some idea of how clarity each grade compares to one another.