The map editor is in Passability mode (also known as "Wallmap mode").

F2 switch to picture mode
F3 switch to passability mode
F4 switch to door placement mode
F5 switch to NPC placement mode
F6 switch to foemap mode
F7 switch to zonemap mode

Use the arrow keys to move around the map.

Use SHIFT+arrow keys to move around the map faster.

Use ALT+arrow keys to move the view of the map.

While you are in passability mode, you will see thick flashing lines that indicate where walls are located.

At the top right corner the current drawing tool is shown. Press SPACE to draw on the wallmap. The tools are:

CTRL+D - Draw tool:
  Press SPACE to make the tile under 
  the cursor fully impassable in all 
  four directions. Press SPACE again 
  to remove the walls and make the 
  tile passable.

CTRL+B - Box tool:
  Press SPACE once to place one 
  corner of the box, and SPACE a 
  second time at the opposite corner 
  to make a rectangle of walls 
  passable or completely impassable.

CTRL+P - Paint on Tilemap tool:
  Finds the continuous area on the 
  current tilemap layer (you can't 
  select or see which layer is 
  selected without switching to 
  Tilemap Editing mode) under the 
  cursor, and adds/removes walls to 
  all those tiles. 

If the current tool isn't the Draw tool, press + or - to toggle whether you are adding or removing walls.

CTRL+Up makes the selected tile impassable on the top.

CTRL+Down makes the selected tile impassable on the bottom.

CTRL+Left makes the selected tile impassable on the left side.

CTRL+Right makes the selected tile
impassable on the right side.

H marks the tile as a harm tile that can damage the hero when the player steps on it.

A marks the tile as special for Airships (or other vehicle or scripting purposes).

B marks the tile as special for Boats (or other vehicle or scripting purposes).

O marks the tile as overhead. This is obsolete. You should create a layer above heroes and NPCs instead if you want make tiles overhead.

CTRL+Z undoes a change to the tilemap, wallmap, foemap or zonemap. Changes to NPCs and doors are not undoable. The undo history buffer is near-infinite, but certain things cause it to be cleared: resizing the map, deleting or swapping map layers, erasing map data, and leaving the map editor.

CTRL+Y redoes an undone change.

TAB toggles a blue rectangle that shows roughly what area of the map you are currently looking at.