Glowstone

Lightstone (aka Brittle Gold, Glowstone, Australium, Brimstone, Sulphur) is a golden block that glows indefinitely. This block can be found in The Nether. It grows on the undersides of blocks, commonly near lava, and forms unusual coral-like stalactites. Lightstone has a luminance of 15, which is the same as sunlight and one more than torches. When breaking this block you get Lightstone Dust. Filling up a crafting bench grid with this yellow dust will create a placeable Lightstone block. Unlike other blocks formed in this way, a Lightstone block will not produce 9 pieces of Lightstone Dust when placed back in a crafting bench. Lightstone has no crafting use; however, it does have a practical use. Unlike torches, it isn't destroyed by water and continues to emit light even when submerged. In this respect, it's a functional and easily applied underwater light. Additionally, the block is a natural source of heat and will melt nearby snow and ice.

It has been found that Lightstone does not require a tool to be harvested, and when destroyed uses the same sound glass makes when shattered. Through testing it appears to be similar to glass in that there is no ideal tool to harvest it, therefore just breaking it off with your fist is the best option unless you don't need your swords, which break the Lightstone at a faster pace than with your fist, but costs two times the normal damage to your weapon.

Just as redstone has been hinted as being a recreation of thermite, lightstone could very well be an implication at sulphur buildup on the nether's ceiling.

Lightstone is a potential item requirement to craft a lantern, as it provides the only infinite source of light in the game. This would also make lanterns relatively inaccessible and a risky item to get, as has been hinted at by Notch.

Lightstone Dust
Lightstone Dust can be found by destroying Lightstone found in The Nether. It takes nine Lightstone Dust in the crafting bench to return it to its original block form, but only drops one Lightstone Dust if destroyed. Lightstone dust currently has no practical use (with the exception of crafting Lightstone blocks). However, it will most likely be used in the creation of lanterns once Notch adds to torches the ability to burn out.