What is this Item I found in Minecraft?

This item above was accidently found when playing Minecraft Multiplayer, what is it? Could someone please explain what it does?

Solution 1:

You seem to have found a spawn egg. You can use it to spawn the type of mob the egg belongs to. To use the egg you simply right click on the ground while holding the egg in your hand it then spawns the mob at the location you clicked on.

The official description as on the minecraft wiki:

A Spawn Egg is an item that may be used to spawn mobs directly. It is available to regular players in Creative Mode and to server operators in both Creative and Survival Mode. It allows the player to spawn a variety of mobs on command, although some mobs are not available for certain reasons.There are 24 eggs available in total without mods or hacking.

The usage of the spawning egg is also mentioned on the minecraft wiki:

A spawn egg is used by the use command (normally right-clicking) on a surface with the egg. The egg's mob will appear with its feet immediately adjacent to the surface. Unlike chicken eggs and Ender pearls, spawn eggs are not thrown; the player must be within normal range of the block. Hostile and neutral mobs (except wolves) spawned while on the Peaceful difficulty setting will spawn but instantly deleted from the world, just like mobs from monster spawners. The player may also place them in dispensers, which will spawn the mob directly in front of the dispenser itself. This would be useful for adventure maps and traps. In Creative Mode, the player can use "pick block" on a mob to obtain their respective egg, provided one already exists.

Fun fact

Spawn eggs renamed by anvils will spawn animals with that name attached to them as an NBT tag. This name will also appear in death messages.

Link to the wiki

Solution 2:

That would be a spawn egg. Look here for further information:

http://www.minecraftwiki.net/wiki/Spawn_Egg

However depending on what the multiplayer server owner did to that item, its effect might differ.