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gem (n.)

"a precious stone" (especially when cut or polished), c. 1300, probably from Old French gemme (12c.), from Latin gemma "precious stone, jewel," originally "bud," from Proto-Italic *gebma- "bud, sprout," from PIE *geb-m- "sprout, bud" (source also of Lithuanian žembėti "to germinate, sprout," Old Church Slavonic prozebnoti "to germinate").

The two competing traditional etymologies trace it either to the root *gembh- "tooth, nail" [Watkins] or *gem- "'to press." De Vaan finds the second "semantically unconvincing" and leans toward the first despite the difficult sense connection.

Of persons, "a rare or excellent example (of something)" from late 13c. Alternative forms iemme, gimme persisted into 14c. and might represent a survival of Old English gimm "precious stone, gem, jewel," also "eye," which was borrowed directly from Latin gemma.

gem (v.)

c. 1600, "to adorn with gems;" earlier (mid-12c.) "to bud," from gem (n.). Related: Gemmed; gemming.

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Definitions of gem

gem (n.)
art highly prized for its beauty or perfection;
Synonyms: treasure
gem (n.)
a crystalline rock that can be cut and polished for jewelry;
he had the gem set in a ring for his wife
Synonyms: gemstone / stone
gem (n.)
a person who is as brilliant and precious as a piece of jewelry;
Synonyms: jewel
gem (n.)
a sweet quick bread baked in a cup-shaped pan;
Synonyms: muffin
gem (n.)
a precious or semiprecious stone incorporated into a piece of jewelry;
Synonyms: jewel / precious stone
From wordnet.princeton.edu