Since the first round of RIAA lawsuits, there has been a lot of concern and many misconceptions over where the lines of legality are drawn. The following guidelines should help you understand what's legal, what's not, and what you can do to ensure you're not breaking any laws.
Downloading from the Internet is legal
This is a good place to start. No matter what fears may have been stirred up surrounding music downloading after the RIAA lawsuits, the first thing you should know is that it is 100% legal to download music from the Internet.There are plenty of legal downloading services that offer music for a per-download or subscription fee.
Not all Internet music downloading is legal
I hate to say it, but the best red flag that you're illegally downloading music is that your music is free and downloaded from a P2P file sharing network. If it is copyrighted (excluding music designated as free using a Creative Commons license or EFF's Open Audio License), especially from a major label, someone will be upset about missing royalties. While there are places where you can find free promotional downloads and free rights music from popular (and not so popular) artists, this is the exception, and most files shared on P2P networks are not this kind of file.
To be as specific/technical as possible, downloading copyrighted material without expressed permission is illegal. Such music must be purchased in order to be legal.
Here are some precautions that you can take to safeguard yourself against an RIAA lawsuit:
Hopefully this has cleared up some of the cobwebs of uncertainty surrounding downloading music using the Internet. And now that you know the limitations, get out there and find yourself a digital music downloading service!