From the Super Mario Wiki, the Mario encyclopedia
The Diamond Jewel is a special item in Paper Mario: The Origami King. It is located in Scorching Sandpaper Desert, buried directly in front of the right foot of the tower. The small gem image on the right foot hints at this, as well as the inscription at the top of the tower, referring to the jewel as an "eye". Mario must have Professor Toad dig up the jewel, then bring it inside the tower to activate it.