Scrub the joint between the sheetrock and the fireplace using a dry scrub brush, getting it free of all dirt and debris.
Load your caulk gun with a caulk tube, snapping in the back end of the tube first followed by the front. Use a utility knife to cut a diagonal ¼-inch hole off the end of it.
Push a 3-inch nail into the hole, breaking the seal inside.
Set the tip of the tube onto the first joint between the sheetrock and the fireplace at one end. If the joint is vertical, start at the top. Hold the gun angled back to about 45 degrees.
Compress the trigger to push caulk into the joint. Move the gun backward along the joint, continuing to compress the trigger, so the caulk lays down in a smooth line in the joint. Continue to the end of the line.
Wet your thumb and run it along the length of the caulk line, smoothing it out. Repeat for each joint between the sheetrock and the fireplace.