In its most usual sense, social engineering is a mainly pejorative term used to describe the intended effects of authoritarian systems of government. The implication is that some governments are intending to change or "engineer" their citizens, for example, by the use of propaganda.
Social engineering has been used by programmers to mean the art of conning a naive person into revealing sensitive data on a computer system, often the Internet. With the profusion of poorly-secured computers with known security holes connected to the Internet, the majority of security compromises are now done by exploiting such; however, social engineering attacks remain extremely common and are a way to attack systems protected against other methods - for instance, computers which are not connected to the Internet. It is an article of faith amongst experts in the field that "users are the weak link".
A contemporary example of a social engineering attack is the use of e-mail attachments that contain malicious payloads (that, for instance, use the victim's machine to send massive quantities of spam). After earlier malicious emails led software vendors to disable automatic execution of attachments, users now have to explicitly activate attachments for this to occur. Many users, however, will blindly click on any attachments they receive, thus allowing the attack to work.
A common approach is dumpster-diving for a piece of paper with a username[?] and password on it. Another ploy is to obtain a username through a similar method and call a secretary or low-level bureaucrat[?] on the telephone, posing to be that person (or systems administrator) and requesting a password change or feigning a forgotten password.
Perhaps the simplest, but still effective attack is tricking the user into thinking you are an administrator and requesting the password for debugging purposes. Users of internet systems frequently receive messages that request password or credit card information in order to "set up their account" or "reactivate settings" or some other benign operation. Users of these systems must be warned early and frequently to not to divulge sensitive information, passwords or otherwise, to people claiming to be administrators. In reality, administrators of computer systems rarely, if ever, need to know the user's password to perform administrative tasks.
Training users about security policies and ensuring that they are followed is the primary defence against social engineering.