from the genesisblock.com

"A 51% attack can occur when a single entity has more mining power than the rest of the network combined. This causes concern because it increases the likelihood of a double spend attack and affects the difficulty of the rest of the network. A double spend attack can occur when a transaction is accepted on one chain, and the attacker creates an alternate fork where they still maintain control of the coins. They could theoretically transfer to an exchange, convert to another currency, withdraw it, then create their own fork where they still maintain control of their original coins. They would have effectively doubled their holdings in a short period of time. An additional effect is the lingering network difficulty after an attack. With a several factor increase in speed comes a corresponding increase in computational power required to discover new blocks. If the attacker then leaves the network, as they did in the case of Feathercoin, this will significantly increase the block and transaction confirmation time until the difficulty can be adjusted downward.