Small fish are passive mobs normally found in oceans. They come in a variety of colours and are usually found in large groups. When killed (by player) they drop a fish egg, right clicking with the egg in hand will place allnhhghhhhbhsjdj baby fish (green rectangle thing), this will eventually become a fish. If you keep a fish alive long enough it will die and drop one raw fish. Not a very effective way of food unless you're close to an ocean.