1. Liz must have seen that Tim was a diamond in the rough, because she asked him out, and now they’re getting married.
2. The boss always thought Sarah had little potential for advancement in the company, but he realized she was a diamond in the rough when she contributed some very useful ideas at the staff meeting.

The expression suggests an uncut diamond, which is unattractive to the eye but which has the potential of becoming a beautiful stone when properly cut and polished. 20