A crowbar makes it possible to break locks and therefore chests open. Together with a picklock or TNT they belong to standard equipment if you want to rob apartments and houses of other players. Breaking of locks is a criminal action for which you will get Crime.
They are regarded as a valuable and expensive item and many players only try to rob other players when no cop is online.
The actual item is a diamond shovel which gets a new texture when using the Crime Texturepack.
Note that one crowbar can only break a single lock open. If there is more than one lock on a chest you will also need multiple crowbars.
Similar to other tools you have to right-click a chest when having a crowbar in your hand. This will destroy one lock on the chest.
Like other house-breaking tools you can purchase the crowbar at the Technician for 300$.
This is also the only shop which sells this very useful tool. However, there is no shop which is buying crowbars.
The ID of a diamond shovel is 277, the item-name is diamond_shovel.
Price: 300$ / ID: 277