The part of the pencil we call a lead used to really be made of the metal, lead. Some pencils used by artists were even made of silver (silverpoint art) and gold, but of course these would be expensive.
200 years ago, pencils were made from natural graphite deposits, which were rare. Then a process was found to produce graphite in quantity. Pencils are now made with a mixture of graphite and clay. The more clay is added, the lighter and harder is the pencil "lead". Pencils are rated according to the HB scale, with 8B being the softest and darkest, going up in hardness to 3B, 2B, B, HB, F, H, 2H...and so on up to 9 H, the hardest and lightest-colored. HB is the most common grade of pencil for writing purposes, also called a "number 2" pencil according to a different scale.