Sandstone

Sandstone is a solid block. It can both be found naturally at the bottom of sand stacks and crafted with 4 blocks of sand in a square, and thus does not require the use of a crafting table.

Hieroglyphic Sandstone (non-official name) is a kind of sandstone with hieroglyphs on it. As of 1.2.4 it can be crafted with two sandstone slabs on top of each other, thus not needing a crafting table.

Smooth Sandstone (non-official name) is a kind of sandstone with a smooth looking texture. As of 1.2.4 it can be crafted by 4 blocks of sandstone in a square, thus does not require the use of a crafting table.

Function and Behavior
Unlike sand, sandstone is unaffected by gravity and will not fall if placed without a supporting block. Sandstone occurs naturally beneath the bottom layers of sandy areas to ensure that it does not start out floating. However, if a lake occurs in that space, it may carve away the sandstone and result in unsupported sand. Sandstone's unique style allows for desert-themed architecture. It can be readily obtained in order to build a shelter and survive the first night in Survival when you spawn in a desert biome though bear in mind one must mine four blocks of sand to compress into a single block of sandstone. Placed sandstone can be harvested with any pickaxe. Breaking a sandstone block by hand destroys the block but drops no resources; it takes slightly longer to mine it with bare hands than a wooden pickaxe.

Sandstone can also be crafted into a sandstone slab. Due to slabs currently being represented by damage values on a single block, sandstone slabs (like the wooden slab) behaves as if it were stone, resulting in it taking longer to mine and having a much greater blast resistance. Sandstone's blast resistance is otherwise similar to sand or grass block, and markedly less than wood or stone.

Sandstone generates together to create desert wells in deserts. They are 5x5 and have a 3x3 plus sign of water in the center, useful for obtaining water, although deserts have many lakes in them.

In 1.2.4, two new textures were added for sandstone. One texture can be crafted using sandstone in a 2x2 block. The other texture can be made by placing one sandstone slab above another.

History
Sandstone was added in Minecraft Beta 1.2. As of Beta 1.3, Sandstone is now found below three blocks of naturally generated sand. Additionally, the ability to craft Sandstone slabs from Sandstone was added in the same update.

Sandstone did not occur naturally in chunks generated in Beta 1.8. This issue was resolved in Beta 1.8.1.

Two decorative types of sandstone were added in Minecraft 1.2.4., Hieroglyphic Sandstone and Smooth Sandstone.

Trivia

 * There are 2-5 textures added in 1.2 Preview which appear to be for sandstone hieroglyph blocks. These were added in version 1.2.4 as decorative blocks in both survival and creative.
 * The first hieroglyph block texture used to have four images, which, in order from left to right, seem to have represented a Human or Villager, a Creeper face, an eye and a footprint or possibly a circle stone brick or a slime
 * The striped hieroglyph (one of the hieroglyph textures (outdated?) bears a resemblance to an Ender Dragon egg due to its similar shape (Although the dragon egg is much wider in game).
 * The striped hieroglyph also bears a resemblance to a Silverfish from a top-down view.
 * Jeb has said that you will be able to craft a hieroglyph block.
 * The texture of the first hieroglyph block will look different in the next update/snapshot.
 * In version 1.2.4, both Smooth Sandstone and Hieroglyphic Sandstone can be used in all the same ways as sandstone, including making more slabs or Smooth Sandstone blocks. Their output rates ultimately give no material loss nor gain.