The new Mac safety net.
Built right into OS X Lion, Lion Recovery lets you repair disks or reinstall OS X Lion without the need for a physical install disc. Since Lion Recovery is built into your Mac, it's always there when you need it. Even if you don't need it, it's good to know it's there. And you don't have to search through original packaging to find install DVDs to get your Mac back up and running.
Command-R to the rescue.
Just hold down Command-R during startup and Lion Recovery springs into action. It lets you choose from common utilities: You can run Disk Utility to check or repair your hard drive, erase your hard drive and reinstall a fresh copy of Lion, or restore your Mac from a Time Machine backup. You can even use Safari to get help from Apple Support online. And if Lion Recovery encounters problems, it will automatically connect to Apple over the Internet.
Read more here.