Tuataras (an ancient species of lizard around since the age 'o the dinosaurs) have a photo-sensitive (that means receptive to light) spot in the middle of its forehead. Some other animals have this as well.

What, were you expecting something religious here?

In most magickal disciplines, the Third Eye is the seat of one's magickal abilities. Physically, it is situated almost directly in front of the pineal gland of the brain. It also directly corresponds with the Chakra of the head.

The concept of the the third eye probably originated in Asia around the 6th century B.C.E., in and around the Indian subcontinent. It was said that the Hindu deity Shiva posessed such an eye.

Tool cuts a live version of Third Eye on their recent release Salival. The Bill Hicks comedy routine is replaced here by a cut-up and re-mixed recording of Dr. Timothy Leary talking about authority and externally imposed views of reality.

The idea that our understanding of reality is externally imposed upon us is also touched on in writing by Robert Anton Wilson, and in White Wolf's role-playing game Mage: The Ascension. This is a very appropriate introduction to the song, since many interpretations of Third Eye (both the song and the thing) connect it to ritual magick and learning to see things through more than one reality-tunnel.

The third eye of animals is actually the pineal gland, an evolutionarily old and structurally interesting part of the brain that is indeed sensitive to light. This photosensitivity is important in body function, because the pineal gland controls production of melatonin, the sleep-inducing brain chemical.

In some amphibians such as frogs and in the juvenile tuatara , the pineal is close enough to the skin surface to receive light directly through a translucent membrane, and thus function to regulate sleep cycles and hibernation. Such third-eye structures are called a parietal eye. In man, the pineal is buried deep between the evolutionarily recent frontal lobes, and so cannot be affected directly by light. Instead, it is stimulated indirectly by signals from the retina of the eye. This is why you can use brightness or darkness to help reset your biological clock when traveling across time zones.

See pineal gland by purple_curtain for an excellent description of this brain structure and its function.