Open your recent calls list by opening the Phone app and click "Recents" at the bottom. You can block an individual caller by clicking the "i" to the right of their name. If you scroll to the bottom you'll see an option to "Block this Caller".
You can manually add or remove callers from the blocked caller list. To find this list click on Settings > Phone > Blocked.
To block someone on your contacts list, just click "Add New..." from the "Blocked" screen and find the contact you want to block.
To remove a contact or phone number from the blocked list simply swipe that number from right to left and click "Unblock".