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Scotland's Cornonation Stone - or is it?
Near Perth is the historic Abbey of Scone, where the kings of Scotland were crowned. The Coronation Stone or Stone of Destiny was "reverently kept for the consecration of the kings of Alba" and, according to one chronicler, "no king was ever wont to reign in Scotland unless he had first, on receiving the royal name, sat upon this stone at Scone, which by the kings of old had been appointed to the capital of Alba." The Stone is an oblong block of red sandstone, some 26 inches long by 16 inches across and 10 inches deep: there are chisel marks on on the flat surface. An early writer, Cambray, claims in his "Monuments Celtiques" to have seen the stone when it bore the inscription: Ni fallat fatum, Scoti quocumque locatum Invenient lapidiem, regnasse tenetur ibidem: "If Destiny prove true, then the Scots are known to have been Kings where'er men find this stone".

Legends
The origin of the Stone is unknown. Celtic tradition harks back to the mythical Lia Fail, "the speaking stone", which named the chosen king, a useful device in the times when royal succession was not automatic. Tradition (or legend, rather) affirms that it is the stone used by Jacob at Bethel as a pillow and then set up as a sacred pillar and anointed with oil. According to Jewish tradition it later became the pedestal of the Ark of the Covenant. The stone had been brought from Syria to Egypt by Gathelus, seeking to escape the plague. On the advice of Moses he and his wife sailed from the Nile with the Stone of Destiny and reached Spain. Gathelus sent the stone to Ireland when he invaded, and it was later brought to Scone Abbey. Upon it were crowned all Kings of Scots, with the Earl of Fife acting as Kingmaker, until 1296, when Edward I of England carried it off to Westminster Abbey in England, along with, it is said, a portion of the Holy Rood (the Holy cross on which Christ was crucified, allegedly brought to Scotland by Queen Margaret). It was installed under a specially-carved Coronation Chair (see picture), upon which all English (and later British) monarchs were crowned, up to an including Queen Elizabeth II.

Back in Scotland
On St Andrews Day, 30th November 1996, exactly 700 years after it was removed from Scotland, the Stone of Destiny came home. This was the inspiration of then Prime Minister John Major, possibly thinking it would reverse the Conservative Party's disastrous fortunes north of the border. It paid no political dividends for them - Mr Forsyth lost his seat, as did every other Tory in Scotland at the next General Election. 
The stone was installed in Edinburgh Castle, with great pomp and ceremony,  alongside the Honours of Scotland (the crown jewels). A crowd of 10,000 people watched the procession of soldiers and dignitaries accompany the stone from Holyrood Palace up the Royal Mile. In the Great Hall of the castle the stone was placed on an oak table and  Scottish Secretary of State Michael Forsyth ceremoniously received it from Prince Andrew, second son of the Queen. 

A twenty-one gun salute was fired from the Half-Moon Battery (once called the Durie Battery) with a reply from HMS Newcastle lying anchored off Leith. In a special service at St Giles cathedral the the Right Reverend John MacIndoe, Moderator of the General Assembly of the Church of Scotland , formally accepted the stone and declared that it's return would "strengthen the proud distinctiveness of the people of Scotland".

But is it the real stone?
One tradition within the family of the Earl of Mansfield (owners of the lands around  Scone Abbey for 400 years) has it that somewhere between 1790 and 1820, a young farm worker was walking on Dinsinnan (Dunsinane, the site of MacBeth's Castle). There had been a torrential storm and a landslide, which had opened or exposed a fissure in the hillside. The lad and a friend explored and found an underground chamber, in the centre of which sat a slab of stone raised on four stone plinths, and covered with carvings. They said nothing about it (which seems unlikely) but years later one of them heard another local tradition, that the monks of Scone had removed the Stone of Destiny to a safe place when they heard Edward Longshanks was on his way. They replaced it with a similar stone, which the English King carried off. He was not able to find the opening in the hillside again, and never found the chamber. 
Certainly, the Coronation Stone in Edinburgh Castle (and previously in Westminster Abbey) is geologically similar to the sandstone found around Scone.

But is it the real stone II?
Another story surrounding the Stone of Destiny is that, when it was stolen from Westminster by Scottish activists in the 1950s (some of whom are now prominent Scottish figures, and were even invited to the Installation at Edinburgh Castle), they replaced it with a fake, which they allowed to be recovered. It is also claimed that the version taken to Edinburgh in 1996 was itself a copy of the one in London, where the "original" resides for safe keeping. It has also been suggested that a copy of this, in turn, was made for public display, with the actual stone taken to the National Library of Scotland. 
This raises the tantalising possibility that:

1. not only was the Coronation Stone in Westminster a thirteenth century fake
2. the stone returned to Westminster after the "theft" was the fake of a fake
3. the one so graciously given back to the Scottish nation in 1996 is the fake of a fake of a fake
4. and a copy of this is what tourists see in Edinburgh Castle - the fake of a fake of a fake of a fake! 

Does it matter?
Symbols have power. Symbols of Nationhood have particular power. It was said that Robert Bruce carried the relics of St Columba into battle at Bannockburn, and possibly even a piece of the Holy Cross (presumably not the same piece Edward I had taken 20 years before), and  that he was supported by the Knights Templar for this reason. The fact of the Stone of Destiny being in Westminster has been used ever since 1603 to underline the legitimacy of a London-crowned monarch as ruler of Great Britain, not just England. And it was no coincidence that Charles II had himself crowned at Scone in 1651 at the last Coronation in Scotland (without the benefit of the Stone, of course) before riding South to re-take his English throne. 
Many commentators have read much into the fact that the Stone returned to Scotland just before the crushing defeat of the Tories and the election of a Labour government, one of whose first acts was to establish a separate Scottish Parliament. 
When the plans to take the Stone to Edinburgh were first announced, there were moves to have it reinstalled at Scone instead. These were scotched (as it were) with the predictable excuses - the Abbey is a ruin - destroyed in 1559 by a mob from Perth, incited by John Knox - the original site of the stone is now just a clump of trees, there would have to be a new Visitor Centre built etc etc. Better to stick it inside the still heavily-defended castle which gets enough tourists as it is, rather than putting it somewhere that could do with the extra business.  It also ignores the existence of the Chapel on Moot Hill (opposite). There is, however, a replica

So it lies in Edinburgh, on display as an historical curiosity, which nicely defuses any deeper meaning it might have if given its due prominence at its original site. In any case, the true symbol of a nation is the character of its people, not some lump of stone (or sword, or piece of wood, or flag, standard, banner or motto).
And maybe it isn't even the real thing - which is just as well, since the Israelis might want it back. And who's to say it's any more ours than theirs?