Carat and karat may sound the same, but they each refer to very distinct topics:
Carat (abbreviated ct) is the standard for the weight of a diamond or gemstone while Karat (abbreviated k or kt) is the measure of gold purity.
Carat is for gemstones
The definition
A carat is a unit used to measure the weight of a gemstone such as a diamond. One carat equals 0.20 grams so one gram is equivalent to 5 carats. The carat represents thus the weight of a gemstone, not its size.
The origin story
Hundreds of years ago, when people needed some standard for weighing their gems, they turned to the carob tree because the weight of its seeds was very consistent and close to the weight of the smallest gems available at the time. Since the carob seed was called a “carat” in Ancient Greek, any stone that weighed like one seed was deemed to weigh one carat.
Karat for gold purity
A karat is a measurement indicating the proportion of gold in an alloy out of 24 parts, so 18K gold is 18/24 parts gold.
The 1/24th proportion goes back to ancient Roman times during which a siliqua, a thin coin, was equal to 1/24th of the value of a golden solidus, a pure solid gold coin.
How it gets confusing
In the UK and Australia, “carat” is the default often used to refer to gold purity whereas the US tends to use “karat”. But, “karat” is never used to describe diamond weight, no matter where in the world you are.