“Something has been lost on this plane, something that is completely and utterly irrecoverable, save for the acquisition of one precious artifact, the only item of its kind in the entire world. And it was placed inside the Midnight Armory, hundreds of thousands of years ago, with the sole point of never being retrieved.”
- Austraeoh, "Whitemane"

The Harmonic Prism is an ancient artifact brought by Celestia and the other Alicorns when they first discovered the world. It channels the light and energy from the Plains of Harmony, and was the device which was used to create the original Elements of Harmony thousands of years ago. Because it is also capable of recreating lost elements when accessed by a soul imbued with harmony, it is the primary objective of Rainbow Dash's quest.

Queen Whitemane describes it in these words:

Something that every group of alicorns carry with them as they seek out the furthest ends of the cosmos to colonize and spread their glory...It is an object that is forever connected with the energy of the Plains of Harmony.  And, once wielded in the hooves of a pure-bred alicorn, it can refract the beam of vibrance and redistribute it into multiple vessels that embody the same power that protects this world.
"The Harmonic Prism was what made the creation of the Elements of Harmony possible.  Once the six elements were created, the Prism's chief function was to act as a backup, to channel great power from the alicorn homeland in the Plains of Harmony and recreate that which was lost."[1]

It is presumably still located inside the Midnight Armory, in the center of the dark side of the world.

According to Luna, " exists because it has to.  The Prism is everlasting.  Even a million eons from now, when most energy from the universe will have been diluted in this part of the universe, the Prism will still remain whole in one way or another"

"The very function of the Harmonic Prism is to focus the energy that first gave the Elements of Harmony their power to begin with.  This includes reinforcing both Harmonic Acclimation and Harmonic Unification."[2]

  1. Austraeoh ch. 123
  2. Ynanhluutr ch. 25