When I first visited Japan two summers ago, in the intense August heat, I noticed how everyone carried little square towels and how every department store and shop sold them as hot items. I was a bit puzzled by the abundance of handkerchiefs, but I now understand the usefulness of them. Japan gets oh-so-hot and humid in the summer, and carrying a handkerchief to dab your face and neck is a MUST.
Most stores and designers make their own. Most of them are towel-like material, while some of them are cotton or silky. You can buy any regular handkerchief, say, from Uniqlo, for under 5$. Designer ones (such as Burberry, Prada, Celine...) go for around 30-50$. Department stores have rows and rows of handkerchief displays, and there are some for every taste.
I have one from Marc Jacobs, and another one from Milkfed (Sofia Coppola's clothing brand). I got both for free, as gifts that came with magazines. I love them! They're also useful to dry your hands after washing them, and for picnics.
Notice the heart theme here? I heart hearts!