From the Super Mario Wiki, the Mario encyclopedia
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The Round Jewel is a special item in Paper Mario: The Origami King. It is located in Shroom City, buried on the small shore of the lake. After aligning the reflection of the sun with the reflection of the top of the tower, Mario must have Professor Toad dig in that spot to unearth the jewel, which they may then take to the tower in Scorching Sandpaper Far West to activate. Once again, the inscription description refers to the jewel as an "eye".