How to dig a hole

How do I dig a hole? I know how to make a hole that goes down but not sideways, like to make a cave into a mountain. How do I do it?

You mean using the terrain system? If so, then it's not possible, although you can use some kind of hack/work-around like this.

Best option to make a cave would be to model one in a 3D software and place it on top of the terrain. Either that or get unity to implement voxel terrain as an option.

There’s a plugin for this on the Asset Store: Terrain Hole System

Description: “This Unity extension lets you make holes in your terrain that characters and other objects can go through.”

More information can be found on the forum thread.