I think this post got some great examples (from SEO Book.com) Link Bait is anything on a website that encourages links from other websites.
Publish something that is valuable to a lot of people and chances are your visitors will spread the news. In some niches like webmasters, internet, tech, etc. it works very well because most of your visotors have blogs as well and will link to your great content. For niches where your visitors are not tech savvy it won't work as expected no matter how great your content is.