Desert

The Desert is a sandy area that spawns desert monsters, cacti, and waterleaf. Each map will generally contain at least two desert areas. Drained Oceans also become deserts. As of update 1.2, pools of water in the Desert biome take on a sandy yellow color. Pyramids are rarely created during world generation in Desert Biomes.

Hardmode
At the onset of hardmode Desert can be corrupted or hallowed. Both of these will be very similar to their main biomes (e.g. The Corruption or The Hallow): the music theme is the same, the mobs are the same (excepted the Dark and Light Mummies), and the background is just slightly different.

The sand will be replaced by ebonsand or pearlsand. Although their color will change, cacti still drop cactus when cut, and waterleaves are also able to grow on hallowed desert.

Making money
If a player is desperate for money, deserts can be a good indirect source. Sand blocks can be crafted into Glass, which can be crafted into Mugs, which are filled at a Keg to produce Ale, which has a sell price of 20 Copper Coins each. Though the sell price is low, this is one of the only sources of coins in the game that is always readily available, as all other abundant block types cannot be crafted into sellable items without other ingredients.

Assuming the player carries only a Pickaxe and one other Weapon for fighting off any enemies encountered, while keeping all other Inventory and ammo slots available for sand collection: 41,958 sand blocks (42 slots x 999 max sand stack per slot) = 20979 Glass blocks = 20979 Mugs = 20979 Ale x 20 Copper Coins each = 419,580 Copper Coins, or 41 Gold, 95 Silver and 80 Copper Coins.

Trivia

 * Despite perhaps some irony, rain will occur in deserts just as in any other surface-biome.