What is the most significant thing Queen Isabella of Spain did and why?
Interesting question! There are actually several important things Isabella made happen. The one she is most known for in the US is her funding, with her husband Ferdinand, of the voyages of Christopher Columbus. This is hugely important both for the financial effects in Europe and the knowledge gained of others' cultures.
She is also important in the formation of Spain. She was Queen of Castile, Ferdinand the King of Aragon. The joining of their countries by their marriage helped formed modern-day Spain.
Isabella and Ferdinand also enabled the rise of the Inquisition. This bout of religious cruelty and murder also resulted in the expulsion of the Jews from Spain, changing the face of the population living in Spain.
In general, Isabella had a great impact on Spain. Not all her actions had the effects she intended. She was very religious, and thought the Inquisition was according to God's plan.