The magic bean is a magical transportation device that first appeared when the Blue Fairy gave to Baelfire in The Return. It allows anyone to travel to another world, including "a land without magic".
History
Baelfire was becoming increasingly worried about Rumplestiltskin, his father, because of how his Dark One powers were making him more and more evil. He struck a deal with his father; if he could find a way for him to safely give up his powers, Rumplestiltskin would have to do it.
He spoke to his friend, Morraine about his dilemma, and she suggested he call upon the Reul Ghorm, who has the most powerful magic there is in Fairytale Land. From there, Baelfire met the Blue Fairy and asked for her help. While there was no way to turn his father back into the man he used to be, she could bring both Baelfire and Rumplestiltskin into another world that exists without magic. The Blue Fairy gave him the last magic bean known to exist and told him to follow wherever it would lead him.
Later, Baelfire greeted Rumplestiltskin with the news of having found a way for him to be rid of his powers. He led his father outside and threw the bean onto the ground. It glowed blue and transformed into a large green sunction portal. Baelfire urged his father to go with him, but Rumplestiltskin backed out of the deal and watched his son disappear into the portal without him.
After Baelfire was gone, Rumplestiltskin realized his mistake and called for the Blue Fairy. She explained that there was no way to get to "a land without magic" anymore. But, after much probing, Rumplestiltskin found out the only other way was to use a create a curse is by sacrificing his homeland (Fairytale Land); a feat the Blue Fairy believed he could never accomplish. He vowed to do whatever it takes as long as he could get to his son.
The bean later reappeared in the episode The Crocodile. While sitting at the table, Rumple was approached by a man who introduced himself as William Smee. He, after hearing of Rumple's power, backstory and reputation, offered him a magic bean that has the ability to travel between worlds. When Rumple replied he thought that there was no more of its kind, Smee said that this bean was from a different land, and he immediately asked what Smee wanted in return. When Smee said he wanted internal life, Rumple replied that he could only make Smee's "clock" go in reverse. However, Rumple threatened him that if Smee tricked him, he would make the "clock" go forward, turning him to dust. When the supposed-death-Milah arrived just in time before Rumple was about to rip Captain Hook's magical heart out, she revealed that she had held Smee and his magical bean captive. When Rumple asked what she wanted, she replied that she was willing to exchange the bean for their lives. The next day, when Rumple went to their ship, he said that although he understood why she left him, he asked why she ever left their son. When she said that she let her misery cloud her judgement, Rumple asked why she was so miserable, and she finally admitted that she never loved him. Angered by this, Rumple ripped her magical her out, and killed her by crushing it into dust after overhearing Milah whispering to Caption Hook that she loves him. Hook angrily pinched a hook into Rumple but he didn't die and cut out off of Hook's hand. Rumple said that he would not kill him but he would let him live and suffer. It is later revealed that the hand that Rumple cut off did not hold the bean. Hook used the magic bean by tossing it into the ocean in order to take himself and his ship's crew to a place where no one ever ages or grows old--Neverland.