Hartshorne asserts in 8.9.1 that $\mathcal I$, the kernel of the diagonal morphism $X \to X \times_Y X$, has a natural $\mathcal O_{\Delta X}$-module structure.
My problem is that $\mathcal I$ is an ideal sheaf on the whole ${X \times_Y X}$, whereas $\mathcal O_{\Delta X}$ is the restriction of the sheaf $\mathcal O_{X \times_Y X}$ to $\Delta X$. So there are only two possibilities: Either we restrict $\mathcal I$ to $\Delta X$, where it is zero, or we extend $\mathcal O_{\Delta X}$ to $\mathcal O_{X \times_Y X}$ by zeros. In either way we have a trivial action, which I highly doubt to be the natural $\mathcal O_{\Delta X}$-module structure mentioned by Hartshorne.