It is also used for carved jewelry boxes.
Technically (in geological terms), alabaster refers to gypsum, which is so soft you can scratch it with your fingernail. However stone workers and archeologists also use the word alabaster to refer to white calcite, which is a bit harder and easier to make into jewelry. They are both composed of calcium in different forms–calcite is calcium carbonate, and gypsum is calcium sulfate dihydrate.
White calcite is also known as onyx-marble, Egyptian alabaster, or Oriental alabaster. However, it has no relation to either onyx or marble. Alabaster artifacts are more likely to be calcite if from the Middle East, and gypsum if from Europe.
They are both sensitive to water, so do not use them in outdoor carvings as they will not survive the weather. It is also not recommended to wash alabaster with water, and detergent can dull its finish.
The etymology of the word alabaster is not definitively known, but it might derive from the Egyptian cat goddess Bast. She was frequently depicted on alabaster vessels.
The purest forms of gypsum alabaster are snow white, but it is often found with iron oxide which gives it a yellow-brown clouding and banding. It can also readily be dyed to produce faux materials like “alabaster coral”. Calcite comes in a range of colors but only white calcite is referred to as alabaster.
The word alabaster is also commonly used as a color name to describe things as milky white, and applied to objects that have no relation to the mineral forms of alabaster.