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Palest yellow and large as a quail’s egg, the Florentine Diamond is among history’s most fabled gemstones.

Its 137 carats, intricately cut, passed through the hands of one European dynasty after another – the Medicis, the Habsburgs – before disappearing in the fog of two world wars. The mystery of its whereabouts inspired rumours, fiction, even a high-priced perfume.

Now, the mystery has been solved. The descendants of its final known owner, Zita of Bourbon-Parma, the last Empress of Austria and Queen of Hungary, revealed on Thursday that the Florentine Diamond has been safely tucked in a vault all along – in Quebec.

The story of how the famed rock ended up there is one of imperial collapse, resistance to Hitler and Canadian hospitality. In telling that tale, along with those of more than a dozen other pieces of glittering Habsburg jewellery once presumed lost and now set to be publicly displayed in Canada, Empress Zita’s grandchildren are hoping to thank the country that took their family in.

“Leaving the items here in Canada is out of gratitude for the country which gave my grandmother 10 years of peaceful living,” said Lorenz von Habsburg, one of her grandsons, sitting in a Montreal boardroom overlooking the city on Thursday morning. “It was a safe haven for my grandmother, and a safe haven for the jewels.”

The origins of the Florentine Diamond, like so much of its subsequent history, are both colourful and disputed. The stone appears to have begun its epic in the hands of the Medicis, Renaissance Europe’s most influential family and governors of Florence (hence the diamond’s name), who liked to show it off in official portraits.

When the last male Medici died in 1737, Tuscany and all its riches passed to the Holy Roman Emperor Francis I and his wife, the Empress Maria Theresa, a member of the House of Habsburg.

Although they were the dominant royal family of central Europe, and laden with magnificent crown jewels, the couple and their descendants maintained the diamond as their personal property, according to research by British historian Richard Bassett.

That decision became significant centuries later, when the Austro-Hungarian Empire collapsed in the wake of the First World War. The nascent Austrian Republic passed a law in 1919 expropriating all Habsburg property, but the family had recently transported their private jewellery, including the Florentine Diamond, to the safety of Switzerland.

Empress Zita and her husband, Emperor Charles, were now effectively on the run, leading to Charles’s death in exile on the Portuguese island of Madeira in 1922, after he contracted pneumonia.

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Zita and her children bounced around Europe for the rest of the interwar period, distinguishing themselves as staunch opponents of the Nazis’ rise to power in Germany and later Austria. The family’s stance earned the ire of Hitler, and when the Second World War broke out, the Luftwaffe descended on the Belgian castle where Zita was living.

One step ahead of their opponents again, the Habsburgs had already fled with the family jewels in a small cardboard suitcase. They ended up briefly in the United States before a confluence of factors drew the Empress to Canada. Quebec was a Catholic society, which suited the pious clan, and the children were already being educated in French. When Canada’s then secretary of state, Pierre-François Casgrain, arranged for accommodation in a house belonging to an order of nuns in a Quebec City suburb, it was settled.

The Habsburgs were rich in jewels but cash poor, and life in Quebec was austere. Zita continued to wear the widow’s black habit, made soup from dandelion leaves and drank tap water at tea time. The house was old and creaky.

“Someone visiting her said they were shocked by the awful linoleum on the floor and the terrible wallpaper,” said Mr. Bassett, author of several books related to the Habsburgs and an associate fellow of Cambridge University’s Christ College.

The Cardinal Jean-Marie-Rodrigue Villeneuve had warned Zita, “You have to realize, when you live in this province, there are two seasons: winter, and July,” recalled her grandson Simeon von Habsburg.

Still, the imperial family was happy. They made friends with a cosmopolitan group that included Quebec’s lieutenant-governor and a prominent Belgian-born Catholic philosopher at Laval University, where the children were educated. Not even the weather dampened Zita’s spirits.

“I like Canada,” she told a journalist at the time. “I like Quebec. I am very fond of French Canadians. They have been kind and considerate of us and, cold as Quebec winters are, they remind me of the winters in Austria. I am making no plans to leave.”

All the while, the family jewels were securely stashed in a bank vault somewhere in Quebec. Zita and her children eventually left Canada after the war, most of them returning to Europe. The jewels, however, remained.

It wasn’t just the famous diamond but millions of dollars worth of precious metals and gemstones, not to mention priceless Habsburg heirlooms including an emerald watch worn by Marie Antoinette and a diamond-encrusted Order of the Golden Fleece.

Given the recurring threats to the family, Zita told her children to keep the location of the trove secret for a hundred years after her husband’s death. But 2022 came and went, and still Zita’s children and grandchildren kept their promise. The Florentine Diamond developed an extensive lore, with articles appearing periodically wondering about its fate (“The 137-karat diamond lost forever”), and rumours swirling that it had been sold, or stolen by a servant and spirited away to South America.

In fact, truth was stranger than fiction: The stone was embedded in an elaborate diamond brooch and wrapped in yellowing paper inside that flimsy cardboard suitcase, burrowed in a Canadian vault.

Finally, after three years of discussions about what to do, the narrow branch of the Habsburg family that has known all along has come clean.

The recent Louvre heist made the Quebec financial institution where the jewels are stored reluctant to reveal their location, even now. But they will remain in Canada for the foreseeable future, held in a Canadian trust with Zita’s descendants as beneficiaries, and be put on public display as soon as possible.

“This is a truly unique story that connects Quebec to the Habsburg family,” said Quebec Culture Minister Mathieu Lacombe in a statement on Thursday. “We can all be proud of the recognition and trust that the family places in us. We are therefore working with the Quebec National Museum of Fine Arts to find a way for these jewels to be displayed and accessible to the public.”

Karl von Habsburg, another of Zita’s grandsons and the current head of the family, said in a statement on Thursday that he was honoured to share the jewels with Canadians as a gesture of thanks.

“In appreciation to this country and its people, we are pleased to exhibit the preserved family jewellery in Canada, where it has found a new home.”

Perhaps it should be called the Canadian Diamond from now on.