Updated: Mar 24, 2021
Natural pearls are formed organically when an irritant, sand or dust, accidentally finds its way into the muscle tissue of an oyster. This triggers oyster's defense mechanism causing it to produce layers of secretion called nacre. These layers then develop into a pearl.
On the other hand, cultured pearls, like the ones we see in the jewelry shops, are formed in the same way with one exception - the irritant is inserted by humans.
People have made significant efforts to farm pearls since a long time ago around the world. The oldest cultured pearl in history is the Buddha pearl in China. Since the 11th century in China, Buddha shaped unclei made of zinc were implanted and produced mabe pearls (with one side flat and the other side rounded). Once this technique has been seen by Christian missionaries, it was introduced to Europe where it prompted research on pearl culturing.
Picture: Buddha pearl oyster shell