The libdvdcss library can be used to decode encrypted DVDs on a Linux system. Most - but not all - commercially marketed DVDs are encrypted. Contrary to the FUD and popular belief, the purpose of this encryption has nothing whatsoever to do with copy protection. It was developed so that an encrypted DVD could only be played on a licensed player. Licenses are granted by The DVD Forum.
While proprietary DVD players under Windows (such as WinDVD) carry a license and come with a built-in authentication, the situation is a bit more delicate under Linux. Linspire is one linux distribution that is actually licensed by the the DVD Forum.
Libdvdcss must not be confused with DeCSS (be sure to see the wikipedia page) - these are entirely different. Whereas DeCSS uses a cracked dvd player and was alleged to have constituted a breach of the law in Norway, and was fought over in court (proceedings eventually were dropped), libdvdcss has never been the subject of legal proceedings anywhere in the world. In contrast, libdvdcss itself is a key cracking program, and simply creates and tries keys until it hits on the right one.
Googling produces little firm information about the actual legal situation concerning libdvdcss in various specific jurisdictions. Binaries can be downloaded from many locations and libdvdcss compiles by default into MPlayer. It appears at this time (2006) that much of the fuss of a few years ago has died down.