In 1911, Mahboob Ali Pasha, the sixth Nizam of Hyderabad, acquiesced to the royal seat The sixth Nizam of Hyderabad was presumed to be one of the most affluent men in the world. It is assumed that he had jewels worth £400 million of which, about £100 million in gold and silver, an annual income of £2 million, and 11,000 servants. His marbled palaces held assets in emerald and crystal, and his collection of pearls defied description.

An inclination for jewels, which The Nizams of Hyderabad had and in order to acknowledge it is only logical that a diamond which lay in the princely state of Hyderabad, unearthed in the Golconda mines, should be called the Nizam. Interestingly, earlier it was famous by the name Bala (little) Koh-i-Noor. Some explanations claim that Nasir-ud-Daula, acquired the diamond from Chandu Lai, the trusted minister of the fourth Nizam around 1835. With the exception of during the period when it was owed to raise funds to stock up the state finances, it was safely kept in the Nizam`s treasury.

At that time, a glass duplication was made to serve as verification. The gem was to some extent cut stone of the finest water that possesses the color and clarity of a true Golconda diamond and was estimated to weigh 277 carats. A reporter from `San Francisco Chronicle` in 1891 scrutinized the stone. The reporter estimated its value at £800,000, an unimaginable sum in those days and compared its size to that of a champagne glass. Even though rumors of its sale or of it being the property of a royal Indian family continue to surface from time to time but the whereabouts of the Nizam diamond still today are unknown.