Atolls, which are circular islands or archipelagos located around a central lagoon, are formed when the soft stone of a volcanic island is worn away, leaving behind only the coral reef that formed at its outskirts. Many Micronesian islands are atolls.

The formation of an atoll begins when an underwater volcano erupts, creating a volcanic mountain beneath the surface. When this mountain builds up and approaches the surface, its rough edges provide an ideal surface for coral to develop. Over time, a circular coral reef builds around the mountain. However, this kind of volcanic rock tends to be soft and porous. The ocean gradually erodes it away, leaving behind a circular reef and a large lagoon. The chemistry of the new lagoon, however, is acidic and kills the coral on the inside. This coral is pounded into sand by water action, and the sand covers and insulates the still-living coral, creating a sandy atoll island over time.

Hawaii has a number of atolls in its northern archipelago, many of which provide habitats for seals and endangered animals. The Micronesian nation of Tuvalu and the Maldives are also atolls. Larger settled atolls often actively work to build the protective sand cover on their islands, dredging the ocean for material to add. Atolls are a feared ocean hazard to boats, but they are also home to diverse colorful species and make ideal scuba diving locations.