The third eye is located down from the crown of your head and between your eyes - in the middle of your head. Go ahead. Close your eyes and try to find it. If you start to think, you are too close to the front of your head. The third eye is located behind your thinking function. When you get there, it feels like this: "Ahhhhh"
This is a place of neutrality and witnessing. When you rest your attention here, you cannot have any judgment about yourself or others. You cannot feel attachment to anything. That's what's so great about learning to meditate from the middle of your head!
You have a lot of functionality in there if you choose to develop it. By itself, it gives you the capacity to SEE. Foresight, Hindsight, Insight, for example. In foresight, you might find you are clairvoyant (which means "clear seeing") and you may find yourself writing, dreaming, or thinking about the future.
If you cultivate hindsight, you could find yourself seeing stories around people - stories that are set in another time in history but that represent some prevalent quality that have in present time.
If you cultivate insight, you might find yourself understanding the meaning of someone's most subtle gestures or seemingly off handed words.
If you are afraid of the past or the future, your third eye might only prompt you toward insight. If you are afraid of what you might find if you really see into things, you might not use your third eye at all.
That doesn't make it any less functional. It just means you are choosing not to use the gift.
If you want to develop it, start by moving your attention to that area and poking around until you find the "Ahhhh" place. Then breathe consciously while you keep your attention there. Even if you do this 5 minutes a day consistently, you will strengthen your intuitive intelligence.
Then when you need to understand something for yourself or others, you are ready to employ your intuitive intelligence so that you retrieve the best path for you and/or others.
Then look out, because if you start craving the silence, it will change your life...