The Nudge item is a tool used to move multiple pre-selected blocks around the map, in Debug Mode. The blocks left behind when a section is nudge will be filled with air, while the blocks in the destination will be replaced by the "Nudged" blocks.
If you wish to undo an Nudge, hit Ctrl+Z (Command+Z). Be careful, though; if you had "Nudged" a large area, undoing the movement with Crtl+Z, or even re-doing the movement with Ctrl+Y may cause your game to crash.
Nuge Hotbar Icon
Select an area of blocks with the Cursor. While holding the Nudge tool, left-click to push the selection of blocks away from you in the direction you are facing (this also works if you are looking up, or down). To pull the selection of blocks towards you, right-click while holding the Nudge tool.
The yellow section of blocks has been selected by the Cursor, and is ready to be "Nudged"
The yellow selection of blocks has been successfully "Nudged" by the Nudge tool