The dreaded "kernel panic" (Mac OS X)
A kernel panic is a type of error that occurs when the core (kernel) of an operating system receives an instruction that it can not complete. A kernel panic may also follow when the operating system is not able to recover from an error. A kernel panic can be caused by damaged or incompatible software or, damaged or incompatible hardware especially, bad ram chips.
UNIX-style operating systems (such as Mac OS X) may experience this type of error called a "kernel panic," which is not dissimilar to Windows famous Blue Screen of Death.
The appearance of a kernel panic varies, depending on which version of Mac OS X you are using.
The kernel panic window in Mac OS X 10.3 or later

If you do see visual indication of a kernel panic, it will appear as a message that says "You need to restart your computer. Hold down the Power button for several seconds or press the Restart button.".
The kernel panic window in Mac OS X 10.2

Recording kernel panic information
Mac OS X automatically logs kernel panics, You can check the kernel panic log any time that you must force restart your computer, using either the power button, interrupt button, or the Control-Command-power key combination. The kernel panic text is added to the log the next time you restart the computer, assuming that you have not reset PRAM at the same time (the kernel panic text is stored in PRAM until you restart). The file is named "panic.log", and it is located on your startup disk at:
/Library/Logs/.
What's in a kernel panic message?
Kernel panics generate information that may help trouble shooting. It is useful to record any information that appears during a kernel panic, in addition to how the computer was being used when the kernel panic happened--was the computer starting up, shutting down, or performing a particular task?
Tip: Update to the latest version of Mac OS X to avoid certain potential kernel panic situations.
http://docs.info.apple.com/article.html?artnum=106704
"Mac OS X, Mac OS X Server: How to Log a Kernel Panic".
http://www.info.apple.com/kbnum/n106228
Troubleshooting
If you have a recurring panic issue and don't know how to troubleshoot it, see "Isolating issues in Mac OS X".
http://docs.info.apple.com/article.html?artnum=25392