Diamonds are graded mainly for color and clarity. The first scale for color goes from "D" color which is the highest and the most expensive indicates that there is no tint in the stone weather yellow or brown or any other color. Jewelers call the "D" color colorless. Then we go down to E, F, G, H, I...Z. The difference between each shades are very thin and will be very difficult to an untrained eye to tell the difference between one shade to the other. It is very common to hear diamond dealers arguing between themselves on a color of a diamond.
It is easier to determine clarity grades but still a thin line separates them. There are different degrees of clarity in diamond grading. No flaws to a 10X loupe by an experienced grader is flawless and as the inclusions get larger and positioned near the center the grade goes down: FL, IF, VVS1, VVS2, VS1, VS2, SI1, SI2, SI3, I1, I2, 13. The lower grades just came into existence in the last 10 years or so (SI3, I3) since folks have been buying lower quality stones. FL=Flawless, IF=Internally Flawless, VVS=Very Very Slightly Included, VS=Very Slightly Included, SI= Slightly Included, I=Inclusions Visible To The Naked Eye.