High ISO settings and image grain or "noise" have long gone hand in hand.
With many digital SLR cameras, the minute you get above ISO 400, the speckling in the image becomes readily apparent, especially in areas of shadow or continuous color (like the sky).
The latest breed of digital SLRs is eliminating the relationship between high ISO and noise.
Here's an image taken with the new Canon EOS 40D at ISO 1600 (well above the usual grainy threshold):
It's hard to see ANY noise at all here, but the image is not at its full size - the reduction in size makes the entire thing look pretty smooth.
Let's solve this problem by selecting a portion of the image and blowing it up to 100% size:
Can you see the grain now?
At 100% size the grain does become visible, but this is exceptionally low for an ISO as high as 1600. This means that you have a lot of leeway with the Canon 40D to boost the ISO any time you feel like it without having to compromise your image quality.
More high ISO samples are available from the link.