The format you'll use is #t=1m30s. The first part #t= marks this as a time stamp. The second part is minutes and seconds, so 1m30s is 1 minute and 30 seconds into the video.
So if I wanted to link to part of a really long video, instead of telling everyone to scroll forward 15 minutes in order to skip the boring introductions, I could instead link them directly to http://www.youtube.com/watch?v=7RluXxZyYDs#t=15m07s.

