Erect a Flame Altar to establish a base. You can craft the Flame Altar in your Manual Crafting tab. Drop the Flame Altar into your hotbar, select it, and place it in the world.

The placed Flame Altar will illuminate the current building range. Here, you can build a shelter for yourself and other survivors. Landscaping inside the building range will remain. Extend the building range by strengthening the Flame at the Flame Altar.

You need a Construction Hammer to build shelter.

Craft a Construction Hammer in the Manual Crafting tab. Select the desired blocks and blueprints to build while using the Construction Hammer.

You can craft building blocks at the Workbench.