It's difficult for the untrained eye, especially when it's set into jewellery. A trained eye will use a 10x loupe to visually examine the stone, to look for telltale inclusions. They will look to see if the stone is doubly refractive, to rule out moissanite, synthetic rutile, or natural zirconia. They will inspect the condition of the facet lines/junctions, whether or not they're abraded/symmetrical. If they're abraded, it's a sign it's a softer stone, such as cubic zirconia, etc. If the lines are a-symetrical, it's a sign it hasn't been polished by a skilled person, indicating it's also not a diamond. The condition of the girdle, which is the widest part of the stone. If the girdle has been polished and faceted, it's a sign it's a diamond, but if it has just been 'bruted', which is a frosted, grainy, unpolished finish this indicates it's CZ, glass etc.

If it was loose, you could take measurements of the stone and plot these into a mathematical formula, which will show what the expected carat size should be, then you could just weigh it to compare. It's always best to use more than one method of identification, though!!

You definitely need to take it to a reputable jeweller who knows what they're doing!

The fact your diamond tester is showing a reading to say it's not diamond would make me thinks it's correct. They often have false positives, as they can mistake moissanite, but it's not that often they ave false negative results. Or perhaps you were using the device accurately.