Technically, a semicolon is a legal sub-delimiter in a URL string; plenty of source material is quoted above including http://www.ietf.org/rfc/rfc3986.txt.
And some do use it for legitimate purposes though it's use is likely site-specific (ie, only for use with that site) because it's usage has to be defined by the site using it.
In the real world however, the primary use for semicolons in URLs is to hide a virus or phishing URL behind a legitimate URL.
For example, sending someone an email with this link:
http:// www.yahoo.com/junk/nonsense;0200.0xfe.0x37.0xbf/kiddie_porn_movie/
will result in the Yahoo! link (www.yahoo.com/junk/nonsense) being ignored because even though it is legitimate (ie, properly formed) no such page exists. But the second link (0200.0xfe.0x37.0xbf/kiddie_porn_movie/) presumably exists* and the user will be directed to the kiddie_porn_movie page; whereupon one's corporate IT manager will get a report and one will likely get a pink slip.
And before all the nay-sayers get their dander up, this is exactly how the new Facebook phishing problem works. The names have been changed to protect the guilty as usual.
*No such page actually exists to my knowledge. The link shown is for purposes of this discussion only.