A lot of my friends have been asking this to me so I’ll just go ahead and make a blog post for everyone. According to facebook:

If you block someone, they will not be able to find you in a Facebook search, see your profile, or interact with you through Facebook channels (such as Wall posts, Poke, etc.). Any Facebook ties you currently have with a person you block will be broken (for example, friendship connections, Relationship Status, etc.). Note that blocking someone may not prevent all communications and interactions in third-party applications, and does not extend to elsewhere on the Internet.

So in essence you become invisible to that person and there is no way he/she can add you back or search for you unless he/she makes a new profile.

Blocking a friend:

The blocking process is fairly simple and most of you already know it:
You just have to click on ‘Report/Block this Person‘ and check the “Block this person” and click on Submit.

Unblocking a friend:

Unblocking friend is a little different and is a bit difficult to find at first. Thats why people have been asking about that to me.
I’ll show you how to do it:
Step 1:
Go to your privacy settings (click here if you are already logged into facebook):

Step 2:
Click on ‘Edit your lists‘ under ‘Block lists‘.

Step 3:
You’ll be presented with your block lists. Click on ‘Unblock‘ next to the friend you want to unblock and click on ‘Confirm’. Thats it.

Cheers!