Rag doll uses certain aspects of physics simulations to give semi-realistic animation to jointed objects at run-time. Very useful for situations where a pre-scripted hand-animated sequence will not work because you don't know where things will happen, what objects will be around the character, what they will hit, how fast they will hit it, etc. It is primarily used to depict characters dying, falling off ledges, getting thrown through the air, etc but it can also be used to simulate chains, bells or other swinging items that need to move realistically, but the movement cannot be determined ahead of time.

Rag Doll Kung Fu is a game made by an artist from Lionhead Studios in his spare time. It utilizes rag doll to give comical animation to the characters. The website has videos showing off the gameplay. Also, take a look at any Half-Life 2 or Battlefield 2 trailers.