Lime Kelp

Look in standing water down in the underground and cavern layers. It needs real depth of liquid over the block it sits on, so shallow puddles produce nothing. When it sprouts it overwrites whatever small growth was already on that soil: plain grass plants, wild jungle plants, moss, glowing moss, even cobweb. That is why a flooded cave you thought you had picked clean has fresh kelp in it an hour later. On a Remix world the layer restriction lifts and it will grow at almost any depth, everywhere except the Underworld.

It is easy to swim straight past. The sprite is a muted green against dark water and lighting the cave barely helps. A Spelunker Potion marks it, and a Magic Lantern trailing behind you gives you a chance. The reliable method is the fullscreen map. Explore an area, then zoom in on the water and hunt for lone dark green pixels, hovering to confirm the name. The map keeps a live feed of everywhere you have been, so a second sweep over old ground shows whatever has grown since you left. Ice caves are the easiest hunting ground of all, because the pale background makes the dots jump out.

A pickaxe takes it and weapons do not, the same as the other dye plants. Lime Dye is the only thing it becomes. If you want a farm rather than a hunt, note that you can only place it into water, but the water is needed only at that moment. Drain the pool afterward and the kelp stays put, so a dry, walkable dye room is possible.