Cubic zirconia (or CZ), is the cubic crystalline form of zirconium dioxide (ZrO2). The synthesized material is hard, optically flawless and usually colorless, but may be made in a variety of different colors. It should not be confused with zircon, which is a zirconium silicate (ZrSiO4).

Because of its low cost, durability, and close visual likeness to diamond, synthetic cubic zirconia has remained the most gemologically and economically important competitor for diamonds since 1976. Its main competition as a synthetic gemstone is the more recently cultivated material, synthetic moissanite.

Cubic Zirconia VS Diamond:
There are a few key features of cubic zirconia which distinguish it from diamond, some observable only under the microscope or loupe, for example:
* Dispersion: With a dispersive power greater than diamond (0.060 vs. 0.044) the more prismatic fire of cubic zirconia can be seen by even an untrained eye.
* Hardness: Cubic zirconia has an 8.5 to >9.0 on the Mohs hardness scale vs. a rating of 10 for diamonds.
* Specific gravity: Cubic zirconia crystals are heavyweights in comparison to diamonds; a cubic zirconia will weigh about 1.7 times more than a diamond of equivalent size.
* Flaws: Contemporary production of cubic zirconia is virtually flawless,[citation needed] whereas most diamonds have some sort of defect, be it a feather, included crystal, or perhaps a remnant of an original crystal face (e.g. trigons).
* Refractive index: Cubic zirconia has a refractive index of 2.176, compared to a diamond's 2.417.
* Cut: Some cubic zirconias use different facet shapes than are typically used for diamonds. This difference would be visible under close inspection with a loupe.
* Color (or more precisely, the lack thereof): Only the rarest of diamonds are truly colorless, most having a tinge of yellow or brown to some extent. By comparison, cubic zirconia can be made in most cases entirely colorless: equivalent to a perfect "D" on diamond's color grading scale.
* Thermal conductivity: Cubic zirconias are thermal insulators while diamonds are among the most efficient thermal conductors, exceeding copper. This makes telling the difference between diamond and cubic zirconia quite easy for those with the right instruments.

Source: Cubic Zirconia on WikiPedia