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Lime is a product of limestone.  You crush limestone into a powder.....you get
lime.
Pretty much the same stuff that farmers use on their fields, but further
refined.
Masons lime is now autoclaved to remove impurities, and add air-entraining
properties.  It used to be that the lime would have to be "slaked" by putting
a bunch on a mudboard in a mound, making a hole in the middle (like a
volcano), and pouring water into the hole.  Slowly, the lime absorbs the
water, and takes on a cheesy consistency.  You cut the mound into quarters,
mix a little bit, and do it again.  This process took three days.  You would
then add this to your mortar, plaster, stucco, or what have you.  The reaction
of the lime with the other constituents creates heat, and acts as a catylist
in curing, rather like "Bondo".
The nice thing about lime is you can control the amount of cure involved with
what you are doing.  If you are laying stone, you want a very "weak" mix, to
allow for the expansion and contraction of the stones.  There are many
different recipes for all the "muds", and all have their place in the grand
scheme of things.
Lime is our friend!
Henry Roeters