**Core Concept**
Iris cysts, also known as iris pearls or iris inclusion cysts, are small, round, and usually benign growths that occur within the iris. They are a type of inclusion cyst that forms as a result of epithelial cells trapped within the iris stroma.

**Why the Correct Answer is Right**
Iris cysts are induced by the inclusion of epithelial cells within the iris stroma, typically as a result of trauma or surgery. The epithelial cells can become entrapped between the iris and the lens or vitreous, leading to the formation of a cystic structure. This process is thought to be related to the migration of epithelial cells from the anterior chamber angle or the lens capsule into the iris stroma.

**Why Each Wrong Option is Incorrect**
**Option A:** Iris cysts are not typically induced by infection, although infection can occur within the cyst. However, this is not the primary mechanism by which iris cysts form.
**Option B:** Iris cysts are not related to the degeneration of the iris pigment epithelium, which is a different condition altogether.
**Option C:** Iris cysts are not induced by the infiltration of inflammatory cells, although inflammation can occur within the cyst. However, this is not the primary mechanism by which iris cysts form.

**Clinical Pearl / High-Yield Fact**
Iris cysts can be a sign of chronic ocular trauma or previous surgery, and their presence may indicate a history of eye injury or surgical intervention.

**Correct Answer: C. Inclusion of epithelial cells.**