What do i do with rabbit hide

You can use 4 rabbit hides to craft leather. This can be good if you don't have cows around.

Because the answer to this question will likely change over time I will give you this link to keep an eye on: http://minecraft.gamepedia.com/Rabbit_Hide. Also, at the time of posting this answer, you can only use it for crafting leather.

At the moment the only use for rabbit hide is to craft leather from it. Place it in a crafting grid in a 2x2 form and you will get normal leather.

This is a useful item, if you ever play on SMP that use entity clears, finding animals can be very difficult. This way you have another source for leather.

In addition to rabbit hides, rabbit will also rarely drop 'rabbits foot' which is a potion ingredient.

http://minecraft.gamepedia.com/Rabbit_Hide

If you don't have any cows around, and you want leather. What do you do?

Well the first thing people do when they can't find a cow is run around the world searching for one. And when they finally found one they don't know how to get home or where they were. Well if you're in the tutorial, you're safe because there is at least three or four cows in one of the pens.

People think rabbit hide is useless because when they try to put it on a wall or the floor it does nothing. Well, that story is about to change. If you have four rabbit hide, then you're in luck because, when you have four rabbit hide you can make leather. I'm not sure how many pieces you get but you'll get some.

Horses are also a good source of leather. And if there isn't any horses, cows, donkeys, mules, or rabbits anywhere (which isn't very common unless you're on a survival island) you're pretty much screwed.