Tool

Tools are items used by the player while held to perform actions faster and more efficiently, to gather materials not obtainable by hand, to gain information, or to perform completely new actions. With the exception of the clock, compass and bucket, tools do not stack in the inventory. Tools can be repaired; see Item Repair.

Mobs
Some tools can be obtained by killing mobs that carry the equipment.

Crafting
All tools can be obtained through crafting.

Best tools
Many blocks have a preferred tool to break them. Some blocks can only be broken with certain tools.

Item durability
Some tools are not block-breaking tools: This includes hoes, bows, fishing rods, carrots on sticks, flint & steel, and buckets. Such tools are no better than bare fists at breaking blocks, but they do not take damage from doing so—they only take damage by being used in their own various manners.

Trivia

 * Gold tools are actually ranked as superior to diamond tools on the Legacy Console Edition's crafting screen.