Details
http://www.minecraftwiki.net/wiki/Beacon
The Beacon is a block used to provide both a unique landmark, and selected buffs to all players in the vicinity. It is activated by placing it as the final block on top of a pyramid formation made up of one to four levels of mineral blocks: diamond, emerald, gold or iron, in any combination. The smallest pyramid that can be made to work with the beacon block has 1 level and consists of 9 mineral blocks.
The beacon will then emit a beam of light into the sky, and its GUI will be available for choosing and activating the desired enhancement or protection. The range of these effects varies with the pyramid size. All players within range will have the chosen effect applied every few seconds, but when players move out of range, the effect will expire within 4-8 seconds.