The format is http://www.youtube.com/watch?v=asdf1234#t=[number of minutes]m[number of seconds]s.
Example: http://www.youtube.com/watch?v=PcBECFLXmuc#t=4m36s
There are two uses for this: One, I can save my place. By entering this little hack into the URL, and then saving a bookmark, (I use www.instapaper.com, but any service or normal bookmark will work,) I can save my place in a long video. Two, this means I can send a video to a friend and not have to say "skip to two minutes in." I can let them jump directly to the portion I want them to see.
Youtube should really investigate enabling saving of location in long videos, but until they implement this, this is a great way to save your place in a long video.