What is Dwarf Fortress? It's an ASCII (actually tile based, but ASCII tiles, for now) game that mixes the best parts of Dungeon Keeper, The Sims and Settlers. Anyway, the point is that it's ugly, but it may be the greatest and deepest game that has ever been made.
A typical (large) fortress: http://koti.phnet.fi.../dwarfgaaah.gif
The game: equip seven dwarves with everything they need to start a new home - food supplies, weapons, tools, seeds, ale, dogs, cats, horses, mules - you name it.
Once you've chosen a site based on certain attributes - average temperature, local wildlife etc... you set off.
In Dwarf Fortress Mode you can dig out tunnels and rooms, build workshops and items, farm crops, hunt elephants, get hunted by elephants, find rare ore and gems, draft military, lay traps to defend against sieges and trade with other civilizations. Your fortress will grow as immigrants arrive and eventually you will start to attract nobles.
Sooner or later you'll lose of course. Maybe your dwarves will starve to death that first, harsh winter. Perhaps the local goblin tribes will gang up and lay siege to your mountain home, slaughtering the lot of you. Maybe civil war will break out. Or, perhaps you'll dig too deep into the mountain - do you remember what happened to Moria...?
The point is that you will lose, but that it's fun. After your first fortress has been obliterated for whatever reason you have two options: One: start another fortress at a new site in the same world, or Two: go into adventure mode. Take control of a single dwarf, human or elf, and explore the world you created as an adventurer. Taking quests from human towns, hiring mercenaries to fight by your side. If you know the location you can even visit the ruins of your old fortress and loot whatever items are left there - assuming you can fight your way past whatever it was that conquered the place in the first place.
If you can reconquer a previously abandoned fortress you can re-settle it with a new party of intrepid dwarves, adding a real sense of history and personality to the place.
Just for kicks, here are a few highlights from my current game. There's so much depth that it hurts:
* A craftsdwarf fell into a "fell mood" and took over a butcher's shop. He popped out halfway through, killed a fellow dwarf and dragged the body in. Later, he came out a Legendary craftsdwarf and proclaimed he had made a new artifact out of leather and bone.

* It's the first winter and things have gone badly. Fishing and hunting weren't going terribly well, there's no farm yet, and dwarves are getting hungry. We had already butchered and eaten all the cats, dogs, and even the horses use to get there in the first place.
The wife of one of my dwarves finally starved to death during that harsh time. He became depressed and drank too much of the ale supplies. The lack of booze caused a massive wave of discomfort to rocket through the fortress.
Then the cannibalism began.
* Looking in the profile of another dwarf it read: "She has witnessed the thrill of slaughter recently. She has had a miscarriage recently."
I don't like to think to much about that...
* Some farmer managed to tame five cats and they all slept in his bed at night. :3
* Zasit Anamalīth, Carpenter is throwing a tantrum!
* Felsite Bridge destroyed by Zasit Anamalīth, Carpenter.
* Zasit Anamalīth, Carpenter has drowned.
Just for laughs, here's a text log from a recent fight a friend had in adventure mode:
(The combat system in this game is the best I have ever seen anywhere, no hitpoints for a start)
The giant cave spider bites You in the head!
It is torn!
You have been stunned!
Your left eye has been torn out!
Your right ear has been badly torn!
You feel numb!
The giant cave spider latches on firmly!
You bash The giant cave spider in the left third leg with your ®širon flailšÆ!
It is broken!
You are feeling sluggish!
The giant cave spider shoots out thick strands of webbing!
You are caught up in the web!
You fall over.
The giant cave spider shakes You around by the head!
It is mangled!
The giant cave spider shakes You around by the head!
You lose hold of the ®širon flailšÆ.
The head is ripped away and remains in The giant cave spider's grip!
You have been struck down.
The giant cave spider spits out the Posa Materthrura Gisu Rusus's head.
Excellent.
It's an intimidating game, there's not a whole lot of documentation, there are a huge amount of options and it's still in Alpha, but if can put in an hour or so to learn the basics you'll be laughing. Go play it now, father.