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Single layer of graphite (graphene) was predicted and later experimentally confirmed to undergo metal-semiconductor transition when fully hydrogenated (graphane). Using density functional theory we show that when half of the hydrogen in this graphane sheet is removed, the resulting semihydrogenated graphene (which we refer to as graphone) becomes a ferromagnetic semiconductor with a small indirect gap. Half-hydrogenation breaks the delocalized pi bonding network of graphene, leaving the electrons in the unhydrogenated carbon atoms localized and unpaired. The magnetic moments at these sites couple ferromagnetically with an estimated Curie temperature between 278 and 417 K, giving rise to an infinite magnetic sheet with structural integrity and magnetic homogeneity. This is very different from the widely studied finite graphene nanostrucures such as one-dimensional nanoribbons and two-dimensional nanoholes, where zigzag edges are necessary for magnetism. From graphene to graphane and to graphone, the system evolves from metallic to semiconducting and from nonmagnetic to magnetic. Hydrogenation provides a novel way to tune the properties with unprecedented potentials for applications.