The geochemical distribution of rubidium and strontium in the central granulite belt of Sri Lanka, where many of the gem deposits are found, was studied. The Rb-Sr ratios, particularly in the stream sediments, were found to be useful in delineating gem-bearing areas from the non gem-bearing or low potential areas. Among the main gem minerals that are mined at present are corundum, spinel, zircon and tourmaline. It was observed that higher Rb-Sr ratios correspond to high gem potential and, even within areas of good potential, barren areas could be delineated using these ratios. During pegmatite formation, Rb is enriched, and there is a marked depletion of Sr yielding a high Rb-Sr ratio. Pegmatites, granites and other magmatic bodies are associated with gem formation under granulite facies conditions and, when used in conjunction with geology, structure, and mineralogy, the Rb-Sr ratio could be used effectively to delineate target areas for further exploration.