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True damascus steel or wootz is amazingly sharp and flexible. The technique for forging it was lost to time sometime around 1800. Modern Damascus steel is more accurately called pattern welded steel. Smiths layer different types of high carbon steel and then forge weld it into a billet of steel which is then shaped into its desired form. Once the blade is formed it is etched in ferric chloride (and sometimes instant coffe too) to reveal the Damascus pattern. I've always been tought that with modern steel the normalising / heat treat / tempering processes make more difference to the overall properties of the blade than what it is made from (within reason).
Recent scientific research suggests that carbon nanotubes are present in wootz which may account for some of their flexibility not too sure about sharpness though. The process for making it was always a very jealously guarded secret, I guess the last bladesmith who knew how to make it forgot to pass it on.
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Bobbo
@3c70
I believe layering the steel gives it the flex more brittle steels lack. Nothing to do with impurities within the metal. This allows you to produce a tougher thinner blade that wont shatter rather than making the same profile non damascus blade with softer steel that has too much flex and poor edge retention.
This improves the blade, not the metal properties and allows for a sharper knife when using harder steel as the core. I believe this is only relevant when the Smith uses the right quality materials to begin with.