Coral

Coral is a solid block which comes in five colored variants: blue, pink, purple, red, and yellow.

Dead coral is a solid block which comes in five different variants: blue, pink, purple, red and yellow.

Coral plants are blocks that can only be placed underwater. Like coral, they come in five variants, but they do not have a dead variant.

Obtaining
Coral will only drop as an item if mined with any type of pickaxe. Otherwise, it will drop nothing.

Natural generation
Coral and coral plants naturally generates in warm ocean biomes in large coral reefs.

Usage
Coral and coral plants can only be used as a building block.

Dead coral
In order for coral to stay alive, at least 1 of the blocks touching it must be water. If it's placed outside of water, it will instantly and irreversibly transform into its respective dead coral.

Trivia

 * Coral was also jokingly teased in the fake snapshot 12marc40awesome, along with fish mobs and "fish blocks".