Torches first appeared in the pre-alpha video of Lords Of Uberdark from the creator, Aaron Bishop.
As of Alpha 37, torches replaced firepots and now have a full shaft although there is no flame present.
Torches attach to objects such as walls.
Torches always attach adjacent to the material it is placed on and have a backend, which can be found in the material.tga file so if a torch is placed, surrounded by dirt, it will change the existing vertex-texture to it and blend that into dirt.