Altars are a new type of block which can be crafted using a Zanite Gemstone surounded by 8 blocks of Holystone. By default, it uses Ambrosium Shards as fuel and can enchant several existing items into their more powerful versions. It can also repair items, although this part has been partially covered for by the anvil in 1.4.2.
Currently, right-clicking the Altar with Ambrosium Shards on your hand will allow you to place Ambrosium Shards on the Altar, up to 16 maximum. They will start to spin around the Altar, and the more shards added, the faster it will spin. To remove the shards, right-click the altar with anything else, and the shards will drop out of the altar. You may also place enchantable items such as Holystone or Quicksoil in the altar and if enough Ambrosium Shards are spinning around the item, the newly enchanted item will pop out of the Altar.
Crafting
Altar Recipes
Note: Quicksoil and Darts can be put on the Altar in stacks of 16 and will only take 4 Ambrosium Shards to enchant all 16.
As of Aether II Alpha, Altars cannot repair items due to a bug. It is recommended to keep your items stored somewhere, as this will probably be fixed in the close future.
Bugs
There is currently only one known bug, which is that the Altar will not take in damaged tools. It will however take in undamaged tools. The player can also put in ambrosium shards as well. If they do it correctly, it will then pop out and give them their undamaged tool back, but not the ambrosium.
Trivia
Altars were called the Enchanter back in Aether I, and had a GUI similar to the Furnace.