This is one of the most commonly asked - and hardest to answer - interview questions there is. We all know we are going to be asked, we just don't generally know what to say.
As with any interview question, the first thing to do is to ask yourself "What are they trying to learn by asking this question?". In the case of Tell me about yourself, that could mean several difference things.
They may want to get to know you personally, they may want to hear about your job history, they may want to know about your education, or they may just be making small talk as you both get settled. How do you figure that out? Ask them what they would like to know, then answer accordingly.
The challenge with that solution is that most job seekers would not be comfortable asking. If that is the case, then you want to try to touch on as much high level information as you can which allows the interviewer to dig down on what interests them.
The best formula I've heard includes:
So, tell me about yourself.