Here's an annoying issue that I've run into a few times while using the terminal (or iTerm) on OSX Lion.
tput: unknown terminal "xterm-256color" No entry for terminal type "xterm-256color"; using dumb terminal settings.
The issue derives from OSX Lion's terminal color settings, which is not always compatible with the settings on remote servers. There are a few ways to fix this issue.
$ export TERM=xterm-256
[ "$TERM" = "xterm" ] && TERM="xterm-256color" alias ls='ls --color'