The Sands of Avalon are magical sands from the isle of Avalon that have the ability to fix anything that is broken.
Before the Curse
Arthur uses the Sands of Avalon on Guinevere. ("The Broken Kingdom")
Guinevere becomes upset when King Arthur grows obsessed over finding the missing half of Excalibur, so she and Lancelot make their way to the Vault of the Dark One, and find the missing half, which is none other than the Dark One's dagger. They're unable to get a hold of the blade due to its protection, but Rumplestiltskin, the Dark One soon makes himself known, and agrees to make a trade with the two for the second best thing. In exchange for the gauntlet, Rumple offers a magic sand that can fix what's broken; it can give the illusion Excalibur is whole. They accept, and head back to Arthur, while Lancelot decides to leave Camelot. Arthur witnesses the two saying a heartfelt goodbye, and when Guinevere returns to her tower, she ends up not going through with using the sand. She instead confronts Arthur, and confesses that she was going to deceive him, but she changed her mind, wishing to give him the choice. He was to either quit his search for Excalibur and stop neglecting her, or she would follow what her heart truly desired. This ultimately resulted in Arthur gaining control of the sand though, choosing to have both; he uses the sand on Guinevere to make her stay blindingly loyal to him, and then uses it on the rest of village, making it into a castle. ("The Broken Kingdom")
Before the Third Curse
Guinevere uses the sand on Snow and David. ("The Broken Kingdom")
When Charming learns that Excalibur is incomplete and can be made whole again by the Dark One's dagger, he wants to use the dagger to help Arthur; however, Mary Margaret approaches her husband and tells him of Lancelot's warning, leading to an argument between the two over whether or not the King can be trusted. Ultimately, they put their differences aside and decide to do what's best for their daughter: Charming goes to Arthur, pretending to have forgotten the dagger, while Snow takes a fake dagger to Lancelot, who's hiding out at Granny's Diner in the woods. He takes her to the Vault of the Dark One so that they can hide it, knowing how to open the seal, and the two of them head down a secret staircase and into a segment of forest that Snow recognizes - it's the same as the one featured in her vision where Emma ripped her heart out, and she now realizes that she must have been foreseeing the Dark One. She and Lancelot go to hide the dagger when Arthur approaches, having followed them, and he threatens Lancelot if Mary Margaret doesn't hand over the dagger. She obliges, but, when he tries to summon Emma, he fails due to the dagger being fake, at which David reveals that he was tricking the King to make sure whether or not his intentions were truly dubious. Since Snow was proven right, Arthur is taken captive... until his knights come to rescue him and a spellbound Guinevere uses the Sands of Avalon to make the Charmings submissive. While Lancelot is locked away, Snow and Charming are suddenly under the belief that Arthur can be trusted, and advise Regina to give him the real dagger after all. ("The Broken Kingdom")