Hatchet

A Hatchet can be used to harvest wood piles in forests and be used as a melee weapon.

The Hatchet can be a primary weapon, or a tool. If you want to use it as a weapon, you need a free primary weapon slot. Otherwise, it will just take a tool slot. It is possible to store the hatchet in your backpack, however it should first be placed into your tool slot and then transferred to the backpack via the standard inventory interface. This is so it does not take up 10 spaces in your backpack! You cannot directly move a Hatchet from the ground to your backpack.

Info
The Hatchet is currently a very common loot drop.

The Hatchet can be used as a melee weapon once switched to the primary weapon slot and can kill zombies in a few strikes.

The Hatchet, when used on other players, will often cripple instantly, and kill in 1-3 hits, this makes it a very good choice in close range combat.

How To Get Wood
To use the hatchet, you must be in a forest standing next to a tree. Solitary trees and other biomes do not yield wood. Forests are highlighted green on the in-game map.

Once you are in the correct location, you can use it to harvest wood by going into your inventory and right clicking it. It will bring up the option to 'Harvest wood'. Clicking this will add a wood pile to your inventory if you are in the correct location and have two inventory slots.

Bugs

 * If a hatchet (or any melee weapon) is dropped and than picked up, you will need to reload it. This is because the hatchet ammo falls out, just like with guns. Melee weapons shoot large, very short-range bullets into things to imitate a melee weapon. (Confirmed by DonglordActual)
 * When wielding a Hatchet, it will sometimes have a different appearance from the loot on the ground: Hatchets laying on the ground are made of light wood and have a red axe head, while Hatchets in your hand are made of dark wood and have a uncolored, rusty axe head. (Unconfirmed)