"Hematite" is an iron-based mineral (iron oxide) that can form as a result of hydrothermal (water + heat) processes. From our experience on Earth, the presence of hematite usually (but not always) indicates a history of water activity. Mars Global Surveyor data shows the Meridiani Planum site to be rich in hematite deposits.

Some scientists believe that on an earlier, wetter Mars some craters may have served as beds for ancient lakes. An extremely interesting feature of the Gusev Crater is the large channel that enters it from the south. This may have been a source of water that produced a large lake within the crater.