The Dung Beetle is a passive Mob exclusive to the Hamlet DLC. It is a bug riding a Dung Ball. Chasing it into a Tree, Boulder or Structure will cause it to fall on its back and become unable to move for a short period.
Dung Beetles will generally move away from the player when approached by Day, but will sleep on top of their Dung Balls at Night, making them easy to hunt at this time. They are considered innocent creatures and killing one adds to the player's Naughtiness, which can cause Krampus to appear.
Similar to Tumbleweeds, the Dung Ball can be harvested by the player and will drop three items, the most common ones being Manure, Rocks and Flint.