Originally Posted by: magicninjaOh I thought diminished meant to drop a whole step.

Not at all. When counting intervals between notes in a scale it's still a chromatic process. Diminished just means lowered or flattened. It also happens that there's an interval step called diminished which happens to be a 5th. Depending on the context, though, it can also be augmented, which is just sharpened. Y'know, that old stuff.

In C major you've got C, D, E, F, G, A, B. It's a major 2nd from C to D and even though the C# isn't involved in the scale, it's position is still counted as the minor 2nd. And that's how chords are made. Counting out specific interval steps between notes and playing the results all at once.