The Underworld

The Underworld (also known as Hell) is the deepest layer of the World. It is largely an open cavity that stretches across the World's bottom, with a ceiling of Ash Blocks and a lower terrain of large Lava pools, Ash Blocks, and Hellstone ore. The Underworld is considered the most challenging biome prior to Hardmode, and is marked by a unique animated background that shows veins of flowing lava.

The Underworld contains many hazards, most prominently a vast amount of Lava as well as frequently-spawning and uniquely challenging enemies. Hellstone, of which much of the solid surface consists, inflicts damage on contact without the proper equipment, while mining it causes more Lava to form. Water that enters this layer evaporates slowly.

The Underworld provides access to large amounts of Hellstone, the main ingredient of Hellstone Bars, which are required to craft high-tier pre-Hardmode items. It is also where the Wall Of Flesh, the final pre-Hardmode boss, may be summoned. Shadow Chests found here can contain unique Underworld-only items. The Demon Scythe, a rare and coveted magic weapon, may be dropped by Demons. Upon defeating one hardmode boss, Lava Bats and Red Devils start spawning in the underworld.

The middle two quarters of the Underworld contains several Ruined Houses, which are Obsidian and Hellstone Brick towers that contain Shadow Chests, Hellforges, Pots, and Demon Torches. The Shadow Key is required to open all Chests found here.

Above the underworld, in hardmode, is a great place to search for ores as it is very deep underground.

Tips

 * After hardmode, the Underworld will be, ironically, the safest place after everything is either Corrupt, Jungle, Hallowed or Crimson. However, once a Hardmode boss is defeated, Red Devils and Lava Bats will spawn. (Note: this can happen before hardmode, if a boss is summoned and defeated before the Wall of Flesh.)
 * You can dig a tunnel two blocks wide down to the bottom of the world. With a Lucky Horseshoe, you can fall down this tunnel, sometimes called a "hellevator". Since you're in a two-block-wide space, monster spawn rates are heavily reduced, especially for the annoying Fire Imps. This gives you the chance to mine as much Hellstone as you want, but use caution when expanding this tunnel; a larger cave has higher chances of Fire Imp spawns.
 * You can bring 50 pieces of Meteorite to the Underworld and thus create an artificial Meteor Biome.
 * In a large world the underworld is about 3000 feet deep; in a medium world it starts around 2000 feet deep.
 * If you stick around the roof in the top part of the Underworld, you may find parts of an Underground Jungle.