Found during the introduction level and is activated by pressing the "F" key. Powered by batteries, is used to light the dark and identify certain items and objects, and is also necessary to proceed at certain points in the game. It will also attract monsters if used in the same room as them. However, the flashlight will continuously get weaker as its battery power runs out, at which point a new battery is needed to use it again. Running out of battery power when you have no extra batteries at points in the game where it is necessary to proceed (e.g. being unable to pick up a key in the darkness) will cause "You" to faint and have him be woken up by the Man Who Wears a Box, who will provide him with more batteries.
As an alternative to using the flashlight, you can simply raise the game's Gamma by hitting the "S" key. Not only does this make things easier to see, but even allows you to interect with certain items or scenery that you could not interact with before because it was too dark.