Iron Bars

Iron Bars were added in the 1.8 "Adventure" update. They are a type of block that seems to occur naturally in strongholds and in NPC villages. They serve a similar purpose to fences.

The iron bars can be placed in much the same way as fences or a glass pane.

History
On July 11th 2011, Notch revealed two new screenshots of a stronghold (in two different brightness settings) where the bars can be clearly seen alongside other common stronghold blocks. The lighting differences have been explained a bit (though not necessarily completely correct) by a user on the forums.

Trivia

 * A 2x2 area made of the Iron bars can make a hole big enough for the player to fit through, but not rain, water, etc. this can be used as an easy entrance for an underwater house, and even an exit if pistons are used. Glass panes work in the same way.
 * If a sign or a painting is placed on the iron bars, it appears to float in the air.
 * Iron Bars have the same placement rules as Glass Panes. When Iron Bars are placed singlely it forms a cross shape, similar to what glass panes do.
 * Since Iron Bars are not destroyed by a Ghast's fireball, and since they block a Ghast's line of sight, Iron Bars can be used as "Ghast-proof" walls for small enclosed roads through the Nether.
 * Iron Bars also prevent fire from spreading, i.e. surrounding a fire with iron bars will prevent wooden items from being lit aflame.
 * Despite apparently being thin enough to do so, Iron Bars do NOT let a ghast's explosion touch the block beneath them as long as the block is protected from other angles of the explosion affecting it. This, in theory, means you should be able to use Iron bars and sticky pistons to make openable/closable shutters
 * If an iron bar is connected to a block and a rail is placed on the block, the top texture of the iron bar disappears.
 * If using the Crafting Table II mod the description of Iron Bars is: Looks good and keeps your prisoners in.

Bugs
++ being one block of iron bars
 * The iron bars do not connect to sticky pistons like they do with walls.
 * being a wall block / piston

instead of | |++++| |    you get   | | ++ | | this      | |++++| |     this      | | ++ | | | |++++| |              | | ++ | |            regular block              pistons

This makes it difficult to make castle gates that are functional and look right.
 * When there isn't a block in one of the sides of the iron bars, it will be pushed into the opposite direction. This also happens with glass pane.