Pickpocketing is a basic concept in the game, and will come up throughout the story, particularly if you play through all of the investigation missions. To pickpocket, you lock onto your target with LT, follow behind them as they walk, and hold B while you get close. Be careful not to attempt a pickpocket when the target is standing still; they seem to be much better at detecting you, compared to when they are moving.
To get throwing knives, you have to pickpocket the big burly guys with the leather pouches on their back. Each time you pickpocket, you will receive 5 knives, unless you cannot carry any more, where you will receive the max you can carry. (You start being able to carry 5 knives, but later can carry more.) This means that at best, you have to pickpocket 40 times, but as a practical matter, you will probably do this more often.
I use throwing knives most often in two scenarios:
* Traveling over rooftops, killing guards (archers) on other buildings;
* Killing the first guard when starting a Save the Citizen free mission.
I ran through this achievement pretty fast in the ordinary course of the game, particularly when I started my flag hunt and spent a lot of time on rooftops. Obviously, this and "Eagle's Eye" work together rather well, though you will get "Eagle's Eye" long before you get "The hands of a Thief".