Places where you can hack LEGALLY and practice to be a Ethical Hacker ;-)

http://roothack.org/games/sirens/info - These guys provide ssh access to two of their servers, for you to hack your way through various levels.
http://heorot.net/forums/ - Download de-ice live cd's to hack your way through a simulated company.
http://www.hackthissite.org - A place to work on your web app pentesting
http://www.hacklabs.com - Download Live CD and access to their network via Open VPN.