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Because diamonds are formed under extreme pressure deep within the earth, virtually all diamonds have a birthmark called inclusions. Diamonds are after all a product of mother earth and were created over a period of thousands of years. The lesser the inclusions are, the more valuable the diamond becomes. The levels of inclusions are:

IF   Internally Flawless (IF)
No inclusions are visible to a skilled grader at 10x magnification.
     
VVS1-VVS2   Very, Very Small Inclusions (VVS1, VVS2)
Minute inclusions are extremely difficult for a skilled grader to see at 10x magnification.
     
VS1-VS2   Very Small Inclusions (VS1, VS2)
Minute inclusions are difficult for a skilled grader to see at 10x magnification and still are invisible to the naked eye .
     
SI1-SI2-SI3   Small Inclusions (SI1, SI2, SI3)
Inclusions are visible under 10x magnification and might be visible to the naked eye particularly in the case of SI3.
     
I1-I2-I3   Inclusions  (I1, I2, I3)
Obvious inclusions are visible to the naked eye and may affect transparency and brilliance