A Prismatic Shard is a crystal that can be found by mining iridium bearing rocks with a suitably upgraded pickaxe. Also can be rarely obtained by opening a magma, frost or omni geode. An easy way to find iridium bearing rocks is to complete the Community Center/JojaMart task to repair the bridge to the Quarry (southeast of the Adventurer's Guild.) The player can potentially get one from the few rocks that are found at the center of the three obelisks in the Calico desert will transform the shard into the Galaxy Sword.
Despite being a mineral, you cannot place a Prismatic Shard in a Crystalarium to make more.
This item is loved and considered a favorite item for every character except for Haley.