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A Settler Unit allows you to create new towns in your civilization. It is trained at the Barracks, for a fee of 25,000 coins * number of towns and 1000 hammers * number of towns (This increases for ever settler you create).
When the settler has finished training, it will appears as an iron door in the deposit chest. You must give the item to a player that is not currently a Mayor in any town. Once you travel to where you would like to create a new town (at least 320 blocks away from any other town, and not in the culture borders of any other town) you can create a new town by holding the iron door in the action-bar and right click on the ground.
While the settlement does not need to be in your culture borders, or anywhere near your current towns, there is an extremely heavy unhappiness burden based on distance. The code for this is not currently known, but from initial testing, a town at the minimum 160 block distance will generate an uphappiness of 1 point, and unhappiness will increase as you travel further.
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