While in Rainbow Zahramay the girls find a Kaliope Crystal which are crystals used to create Genie Gems. The twins suggest to Leah that they take it to Princess Ula, the Ruler of Rainbow Zahramay who is responsible for making Genie Gems. They travel to Ula's Palace. They encounter a mermaid who they discover is actually Ula in the form of a Mermaid. After showing her the Kalliope Crystal, Ula shows them her workshop where she makes Genie Gems. She demonstrates how a Kaliope Crystal is turned into a Genie Gem, by using one over her Kaliope Crystals breaking it apart to create a blank gem and then imbue it with the power of Music to create a Music Gem. She then offers to let the girls create their own gem using the crystal they found. Leah wants to create a Flight Gem, while Shine wants to create a Speedy Gem, and Shimmer wants to create a gem that makes things bright and shiny. Ula however explains that they can only add one magic power to the gem. Though the girls think they are in agreement they end up imbuing different powers into the gem which results in an unstable Chaos Gem, which randomly produces the magic it is imbued with causing havoc. However Ula explains she can turn it back into a blank gem, though they need to put it on her gem pedestal to remove the magic before it becomes a Chaos Gem permanently. They chase it through the palace, but it goes into the water and the girls reveal that they could get it if they had their Genie Gem, causing Ula to show them her Divina Gem which possesses the power of all the gems Ula created including the Mermaid Gem, allowing them to transform into Mermaids to chase after it. They follow it back to Ula's workshop, where it causes Leah and objects to levitate. Eventually Shine manages to catch the Chaos Gem and Ula uses her staff to remove its magic, turning it back into a blank gem. The girls try again and decide to create a Rainbow Gem which has all the powers they wanted as it allows them to create rainbows to ride on.
- Genie Gems: This episode introduces how Genie Gems are created from Kaliope Crystals which are crystals used to create Blank Gems which are then imbued with magic using Ula's staff and gem pedestal to create Genie Gems. Several different gems are introduced: Blank Gems which are gems that have not yet been imbued with magic, Music Gem which is imbued with the power of music, Chaos Gems which are unstable gems created by imbuing a gem with separate powers (such as the Chaos Gem created by the girls which had the power of Flight, Speed, and Color Changing), the Divina Gem which is a gem created by Ula that contains the power of all the gems she has created and is implied to be the one of the most powerful genie gem that exists, and the Rainbow Gem created by the girls which has the power to create rainbows which the girls can ride on using rainbow boards. The Mermaid Gem is also mentioned to have been created by Ula as the Divina Gem possesses its power, allowing Ula to use it in the same manner as the Mermaid Gem and is implied to be how Ula transformed into her mermaid form that the girls first encounter her in.
- Note: This episode introduces the Ruler of Rainbow Zahramay Princess Ula who is responsible for creating Genie Gems.