Spectroscopic evidence for the existence of gadolinium was first observed by the Swiss chemist Jean Charles Galissard de Marignac in the minerals didymia and gadolinite ((Ce, La, Nd, Y)₂FeBe₂Si₂O₁₀) in 1880. Today, gadolinium is primarily obtained from the minerals monazite ((Ce, La, Th, Nd, Y)PO₄) and bastnasite ((Ce,La,Y)CO₃F).

Gadolinium has the greatest ability to capture thermal neutrons of all known elements and can be used as control rods for nuclear reactors. Unfortunately, the two isotopes best suited for neutron capture, gadolinium-155 and gadolinium-157, are present in gadolinium in small amounts. As a result, gadolinium control rods quickly lose their effectiveness.

Gadolinium can be combined with yttrium to form garnets that have applications in microwave technology. Gadolinium can be alloyed with iron, chromium and other metals to improve their workability and their resistance to high temperatures and oxidation. Gadolinium compounds are used to make phosphors for color televisions.