Okay...What in the nine hells is this item used for....theres no description other than some garbled text that tells you that the item can do something GREAT :D :D

Combine it with the Bronze Ioun Stone( in the Vampire infested Saradush dungeon) to enhance the Circlet's power.

Memorise extra one 7th and 8th level spells for Mages/Sorcerer.
+10 to maximum Hp

Woooooooooosh...I like dat

Spoiler
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To get the Ioun Stone, you must find in the vampire prison a skull(in a barrel at the northern corner) and then place it in a cell with the ghostly apparition and put holy water with it). You'll then get a key to open a locked door somewhere in the prison.

Just where are we...?

BOINK...BUMP

I am still wondering about the whereabouts of this vampire prison?

Sparhawk grinned to his friend...as Tynian flipped him the middle one

Just go in the Prison, about 7:00 {southwest} in the bottom of Saradush. Believe me, use Negative Plane Protection.