Sphagnum or peat moss grows in wet areas and can gradually fill a size comparable to that of a lake. When sphagnum moss continually sinks to the bottom, it can create peat deposits like those found in England and Ireland. Jerry Bergman cites a reference, which states that peat bogs in the northern countries cover an area half as large as the United States. Sphagnum moss is used as a surgical dressing because it is so absorbent.
One way to tell peat moss from other mosses is the distinctive branch grouping. Also, the shape and color of peat moss help identify it as peat moss. A single piece has closely ordered bunches of branch fascicles. These usually have both hanging and spreading branches often in a 4:3 ratio. Branch leaves that are usually ovate or lanceolate shelter these hanging or spreading branches.
A single main stem supports these branches and carries out the regular processes of a stem. Down the sides of the stem, various stem leaves grow in shape according to species. Leaves have hyaline cells, that are large, clear, dead cells. Leaves also have chlorophyllous cells, which are smaller green cells.
All of the moss is permeated with microscopic spaces or tubes, which create an arrangement of fragile capillary tubes much like a sponge. These cells often absorb water and then preserve it for later use. This water can then be squeezed out, without the Moss collapsing which will be ready to take in liquids again. Tight groups of young branches grow on the capitulum, or top of the plant. 
Sphagnum can reproduce in a few ways. One way is through a process called fragmentation. Fragmentation happens when a piece of the moss breaks off and is dropped away from the moss by animals, wind, or water. Once this piece of moss reaches an area that is apt for growth, a new plant can begin to grow. 
Peat moss also reproduce by alternation of generations. At the tip of small stalks called calyptra, spores are released that grow to form a bud, which will grow into a new male or female plant. These also sexually reproduce with the sperm from the male plant entering the female plant and fertilizing an egg that grows into the calyptra.
Sphagnum moss has little capsules that launch spores when ripe. Science News notes that the capsules are constructed to launch spores upward using a vortex (the same doughnut shaped torus of air that allows smoke rings to travel) that boosts the spores twenty times higher than they would go on velocity alone. When the article was written (2010) no other plant was known to use a vortex to scatter pollen or spores.
Peat moss can be found in many places, but most commonly it grows in the Northern Hemisphere. The farthest north that peat moss grows is Norway at 81 degrees N. The environment that it grows best in is a boggy or moist area such as tundra or peat bogs. Chile, New Zealand, Argentina, and Tasmania have the most peat moss below the Northern Hemisphere.  It grows so tightly together that it can create large clumps. Although peat moss is a moss, it is rarely found in normal forests especially in the Southern Hemisphere. 
Sphagnum has many uses. Peat moss can be added to the soil and will help with plant growth and increase the soils absorption of water. Another use is for bedding in farms or stables because of its great absorbing abilities. It was also often used to dress wounds because of its properties to equally absorb the blood. This posed a problem because sphagnum can cause the fungal disease, sporotrichosis. Another more recent use of sphagnum is to help clear septic tanks of clarified liquid output, or effluent. Puraflo® passive wastewater biofilter system, is an example of this use of sphagnum in septic tanks, and is manufactured by Bord Na Mona - Environmental Products U.S. Inc. 
- Sphagnum Wikipedia
- Moss, Sphagnum Botanical.com
- The Critically Important Plants Called Mosses by Jerry Bergman. CRSQ 35(1):27-30