Obsidian is created when a source block of lava is contacted by a flowing or source water block. Obsidian is not hard to come by, However, it is difficult to harvest; The block takes time to break and you need Diamond Pickaxe (or greater) to do so.
It can also be obtained when the Kreknorite Meteor from the Falling Meteors Mod begins to cool. Kreknorite blocks will cool into Obsidian, and this results in Obsidian being readily available on the Overworld surface.
Obsidian is a Material in the Tinkers' Construct mod. It can be smelted at the Smeltery to produce Molten Obsidian which can create Obsidian Ingots for weapons and tools. Doing this may also produce Obsidian Chunks, which can then be used to produce other Obsidian parts or repair broken Obsidian tools. Pouring Molten Obsidian into a Casting Basin will result in a normal Obsidian block instead of a block of ore (such as Copper, Iron, Brass, etc.).
Obsidian is used in the crafting of Obsidian Brick, Altar of Light, Altar of Souls, Soul Crucible, Skybeam Block, Ender Shield, Ender Giant Sword, Industrial Blast Wall, Industrial Glass Wall, Storage Capsule Station, Scale Armor, and Obsidian Pressure Plate. It can also be smelted in a Smeltery for 288mB of molten obsidian. Obsidian is used in the creation of Nether Portals. Make a frame of Obsidian leaving a 2 block wide, 3 block high space in the middle, then light the bottom blocks with Flint and Steel.