Dynamite

Dynamite is the strongest of all explosives, destroying a great area when thrown. Dynamite can destroy almost any known block, exceptions being Dungeon Bricks, and Hellstone as of version 1.01. Some other blocks are resistant, like Obsidian.

Also sold by the Demolitionist once he has moved into the player's town.

Mining meteorites
Dynamites work exceptionally well for mining metorites. 1-3 dynamites strategically placed will mine 80-90%, if not all, of the metorite and instantly stop more Meteor heads from spawning allowing you to safely mine the remaining ore with your pickaxe.