It is obtained by killing Pharaoh Nabak in the Desert Temple that is being excavated by Wynn Excavation. At this point, it is an Untradeable Item.
At the end of the quest, it is given to Excavator Vade, who then gives back the Yellow Crystal Shard as a Quest Item. It is necessary to start the WynnExcavation Site B quest. If the player does not have it in their inventory, Excavator Lykron will not reply when they talk to him.