Named for it's architectural motif, Carousel Boutique is Rarity's dressmaking shop and is reknown all over Equestria. She receives commissions from faraway places to make new outfits for attendees of the Grand Galloping Gala, including orders from Equestria's capital, Canterlot. The boutique is twice visited by well-respected moguls of the fashion industry, once by Hoity-Toity and once by Photo Finish. Impressed by Rarity's work Hoity-Toity orders her designs to be sold in his boutiques. Photo Finish was more interested in Fluttershy and a deal never panned out between her and Rarity.
The lower floor of Carousel Boutique is a store, showroom, and workshop. Materials visible throughout the store include jewels, thread, sketches, bolts of fabric, and horse-shaped dress form mannequins. She uses a sewing machine but has been seen sewing by hand. The upper floor is her bedroom which also contains dressmaking supplies and equipment.