A character can be turned to stone (aka stoned or petrified) in a couple of different ways:

A character who is stoned cannot act in any way--no fighting, casting spells, identifying, or using items.

Stoning can only be cured by having another party member cast the priest spell Madi on the affected character or by helping them at the Temple of Cant.  The cost to cure such a rocky character is 200 gold per level.

When a character is stoned at the end of a battle (whether he was petrified during the battle or before it), he is not included in the distribution of experience points or treasure . If the entire party is paralyzed, dead, or otherwise incapacitated, the game will autmoatically kill them off and move to the graveyard scene.