This article is from the Final-Fantasy and other Square Soft Games FAQ, by firstname.lastname@example.org (Nick Zitzmann) with numerous contributions by others.
During disc 2, take Emeralda to the lighthouse, which is located just
south of Deus. Somewhere inside the ruins below the lighthouse is a
small manhole which the characters can walk into. (It appears in a large
open space just ahead of the entrance. Fei will let you know when you're
getting close to it. It's hard to spot...)
Take Emeralda down there, and you'll learn the rest of the story about
the Zeboim civilization, including the development of Emeralda.
After this, Emeralda will suddenly grow 10-15 years older. This does
nothing to her stats; it just changes her appearance and allows you to
trade the Mermaid Tear (from the drunk guy in Lahan) for a better item
in the Snowfield Hideout.