Arc Reactor

"That doesn't look like a Jericho Missile." "That's because it's a miniaturized arc reactor. I got a big one powering my factory at home. It should keep the shrapnel out of my heart."

- Ho Yinsen and Tony Stark

The Arc Reactor was a unique kind of energy source created by Howard Stark and Anton Vanko. There are two versions of it: the giant industrial version and the miniturized 'chestpiece' version perfected by Tony Stark. Howard saw it as a way to create a new element to replace nuclear power. As Anton only saw it as a way to get rich quick, Howard had him deported back to Russia, later leading his son, Ivan Vanko, to seek revenge on Tony Stark for ruining their lives.

History
"What do you want me to do with this?" "That? Destroy it. Incinerate it." "You don't want to keep it?" "Pepper, I've been called many things. Nostalgic is not one of them."

- Pepper Potts and Tony Stark

After a bomb exploded near Tony Stark, shrapnel entered into his body but Dr. Ho Yinsen created a way to stop it reaching his heart using a powerful magnet and a car battery. Tony knew he had to replace the battery so he invented a smaller version of a giant Arc Reactor that powered his factory. He and J.A.R.V.I.S. then modified it to power the Iron Man suit.

After Tony learned that the Palladium in the Arc Reactor was poisoning him he replaced it by creating the new element using Howard Stark's original research.

Tony had used Arc Reactor technology to power the Stark Tower. The Arc reactor in Tony's chest saved him from being controlled by Loki.

After defeating Aldrich Killian and A.I.M., Stark had undergone surgery to remove the shrapnel with assistance of Wu and had the arc reactor disposed off in the sea at the ruins of his mansion.