Hoe

Hoes are tools used to till dirt and grass blocks into farmland blocks, the first step in farming. Seeds can be obtained when tilling grass with a hoe. The chance of finding seeds was increased in the Beta 1.2 update. Grass is tilled by right-clicking on a grass or dirt block while holding a hoe.

Crafting
Hoes are crafted using 2 sticks and 2 units of a tool material:

Trivia

 * Tilling a dirt block which has a dirt block on top of it will change it to farmland even though it cannot be used. If a hoe is used on a block horizontally adjacent to such a block, the first block will revert to dirt and the selected block will not be tilled. The hoe will still take one point of damage from each use.
 * Prior to the Beta 1.2 update, there was a glitch with bedrock that makes use of the hoe. Placing a dirt block under a bedrock block, tilling the dirt, and planting a seed on it would cause the bedrock to disappear without yielding any blocks.
 * The hoe does not give any faster mining of dirt blocks or grass blocks.
 * When you till a dirt block, the top layer should be removed. In fact, due to the way farmland is textured, it appears as if the block sinks into the ground. This is explained as the texture is shifted down to the new 'top'