Cobblestone

Cobblestone is a darker block, often looking like a roughly paved area. This block only occurs naturally in dungeons, or when water and flowing lava come into contact. It makes great walls for constructions such as castles, towers and roads. Cobblestone is obtained by mining stone. Cobblestone is slightly harder to mine than normal stone, and there is an alternative version of the block known as Moss Stone, which can only be obtained from dungeons.

Current Uses
Cobblestone is required to craft furnaces, Cobblestone Slabs, stone stairs, stone tools and weapons, levers, and dispensers. Because of the abundance of stone, cobblestone is a commonly-used building material.

Cobblestone can be smelted back into smooth stone in a furnace.

History
Cobblestone was one of the first ever blocks as seen in very early Minecraft footage, when the game was just a clone of Infiniminer, called "Cave Game". Its textures are from one of Notch's previous games called RubyDung. Cobblestone was removed in 0.0.19a, but returned in 0.0.20a. It was removed due to lack of room in the UI. Because of its dark color it was often used in pixel art to represent darker colors until other, darker blocks like black wool and obsidian appeared.

Cobblestone started out with this texture which looks very similar to the current one, but with less detail.

In Minecraft 1.7 the cobblestone got a new texture which is lighter than the previous one. It is also a little smoother.

Future
Jeb confirmed on Twitter that as of Beta 1.7, cobblestone will have a new, lighter texture with milder contrast. This new texture can be seen in the piston video that TeamMojang uploaded recently.

Trivia

 * Cobblestone is created when water attempts to flow into a block already occupied by flowing lava.
 * When water flows into the source block of lava, it creates obsidian instead.
 * Cobblestone is resistant to Ghast fireballs, making it useful for guarding portals.
 * Until the release of Minecraft Beta 1.3 cobblestone was used to create stone slabs.
 * Cobblestone makes up the walls and, along with Moss Stone, the floor in dungeons.