Also it has an encoder shipped with it (MEncoder), which is very powerful.
See also: MPlayer on Wikipedia.
MPlayer in Debian
See the Debian mplayer FAQ for some background information about the MPlayer in Debian saga.
The proposed source package has been stripped from at least encrypted DVD playback and mencoder.
In September 2006, there was an update and summary on the case on debian-devel.
Binary codecs (optional)
The included /usr/share/mplayer/scripts/binary-codecs.sh script can be used to obtain a tarball containing binary-only codecs, extracting these to /usr/lib/codecs. These are used by MPlayer to provide support for file formats not supported natively.
# /usr/share/mplayer/scripts/binary_codecs.sh install
mkdir: created directory `/usr/lib/codecs'
mkdir: created directory `mplayer_binary_codecs'
Downloading mirrors list..
Getting codecs list ...
Downloading MD5 sums from main site
2009-04-15 00:12:01 URL:http://www.mplayerhq.hu/MPlayer/releases/codecs/MD5SUMS [2145/2145] -> "MD5SUMS" 
Downloading and installing essential-20071007.tar.bz2 ...
Downloading essential-20071007.tar.bz2 from http://www1.mplayerhq.hu/MPlayer ...
--2009-04-15 00:12:01-- http://www1.mplayerhq.hu/MPlayer/releases/codecs/essential-20071007.tar.bz2
Resolving www1.mplayerhq.hu... 126.96.36.199
Connecting to www1.mplayerhq.hu|188.8.131.52|:80... connected.
HTTP request sent, awaiting response... 200 OK
Length: 10009454 (9.5M) [application/x-bzip]
Saving to: `essential-20071007.tar.bz2'
100%[=====================================================================================================================>] 10,009,454 574K/s in 44s
2009-04-15 00:12:47 (222 KB/s) - `essential-20071007.tar.bz2' saved [10009454/10009454]
Checking MD5 for essential-20071007.tar.bz2
Installing essential-20071007.tar.bz2 ...
Installed essential-20071007.tar.bz2 Succesfully!