Assuming this is a dual CPU machine I'd say a high load average is probably in the range of 4 or higher so 2* the number of cpu's. But really load average just tells you how many processes are waiting in line for CPU time. You can create high load averages without a heavily loaded machine if you want to. I'd be more concerned about server load when things start to get slow. At that point you'd be looking at is it my CPU that's all being used? Maybe it's the fact there is no ram left as a result the CPU is offloading RAM onto the drives which is very very slow. Or the worst of them all the hard drives are the bottleneck causing the cpu to wait for them before it can process things.
It depends on what you are doing, on loaded hosting boxes I generally allow the boxes to spike to 15 for a a short while before taking action. Try checking vmstat (type: vmstat 1) and see where your cpu is going if it is high. Like the first reply said, you could have a high load but still be processing the current tasks fine because the load could go higher as other processes wait for resources from disk and such. - Sebsastian Rametta
2x p4 2.8ghz with 2GB ram can be a good server if you are not hosting any very large DB driven sites, for static sites you would not see it going RED normally. you can check your load averages and then ask whether its normal or not.
Loads are normal when they are less than the number of cpus. ex. 0.50 for 1 cpu(single core single proc.) You should check whats causing high load if its more than 1. Or you may upgrade to a better processor as well.
And yes, the culprit might not be only the CPU...load values in linux is generally cited the no. of processes in queue or being currently processed, but it counts other factors too...thats why it's system load and not CPU load. There might be IO/network latency or other factors too. In some cases, you can still have a quite responsive website even if load values cross 10!