Its 'Safe Boot' not 'safe mode' ala Microsoft Windows and it does the following:
Runs fsck on startup
Loads a minimal set of Kernal Extensions
Runs a minimal set of startup scripts
It does not launch your startup items
To access safe boot, hold the Shift key during startup. The Shift key should be preseed after the startup tone (not before). Let go as soon as you see then grey spinning progress wheel. When you are booting in safe boot, you will see \"safe Boot\" on the Mac OS X startup screen.