When we first moved in our house, here is what the fireplace wall looked like:
Then my husband built out a frame for the fireplace, and I painted the wall an accent color:
Then we tore out the tile around the fireplace and on the hearth. We put up onyx 1/2" mosaic tile around the fireplace and 1" onyx mosaic tile on the top of the hearth. Then we installed a wood moulding front for the hearth. My hubby added some more moulding to the fireplace mantel surround.
So then we decided to add stacked stone to the fireplace wall. This required that hubby tear out the drywall above the fireplace mantel and put backerboard up in its place so it would support the weight of the stacked stone we were going to add. I think the final result turned out really well: