Conditions
About 500 million years ago, the foothills of New York State's Adirondack Mountains and the lower Adirondack plain were being covered by layers of sand and limey deposits by a shallow sea. This process continued for about 25 million years. The layers of carbonates were subsequently covered by thousands of feet of sediment, resulting in various layers of limestone rock. One of these layers contained calcium magnesium carbonate, more commonly known as dolomite. Herkimer diamonds began to appear when the surrounding dolomite rock had between 3,000 and 3,500 feet of sedimentary cover.
Water Theory
No one knows for sure the exact process by which Herkimer diamonds were formed. According to the Herkimer Diamond Mine's website, the most popular theory is that water rich in carbonates found its way through the dolomite and became trapped in certain places. The trapped water slowly dissolved the surrounding rock, causing small cavities, or vugs, to form. At some point, water saturated with silica also seeped through and became trapped. When this water evaporated, it left large silica deposits that would eventually form crystals.
Marine Life Theory
Another theory suggests that the presence of early forms of marine life helped create vugs. A coal-like material, known as anthraxolite, found in some vugs may have been formed by the decomposition of trapped plant life. The subsequent deposits of silica required to grow the crystals may be the result of trapped tiny sea organisms known as radiolarians that secreted silica in a range of geometrical shapes.
Discovery
During the so-called Ice Age -- about 1.5 million years ago -- an enormous ice sheet smothered the region. When this melted, the force of the rushing water began to erode its way through thousands of feet of sedimentary rock. This resulted in the layers of dolomite becoming exposed. For a fee, modern collectors are able to prospect for the diamonds at the Ace of Diamonds Mine and Herkimer Diamond Mine on New York State Route 28 in Middleville, New York.