In this paper, microscopic observation, X-ray diffraction (XRD), X-ray fluorescence (XRF), inductively coupled plasma (ICP) and electron probe micro-analyzer (EPMA) technologies were used to investigate the characteristics of petrography, mineral and chemical composition of Nanhong agates from Baoshan, Yunnan Province. Moreover, scanning electron microscopy (SEM), energy disperse spectroscopy mapping (EDS-Mapping) and laser confocal microscope Raman were used to investigate the morphologic structure, chemical component and mineral phase composition of colored minerals. The results show that Nanhong agate mainly consists of quartz (>95%) and the most common structures are fiber and granular structures. Nanhong agate has some auxiliary minerals including coesite and calcite and contains two kinds of water for adsorbed water and structure water. The colored minerals could be divided into four categories, i.e., medicine balls mineral grains with diameter less than 1 μm, flocculent globular aggregations with 2~10 μm, needle-like mineral particles and irregular shape mineral types, and all of them have iron minerals. Furthermore, micro Raman study shows that the color of Nanhong agate results from iron minerals, and goethite and hematite could bring red and yellow color respectively. The value of Nanhong agate depends on content form and distribution of iron minerals. This study not only provides useful reference information for Nanhong agate research and has important significance for completing the knowledge system and promoting Nanhong agate culture but also offers a new way for investigating gemstones by using micro Raman technology.