In the early1970's and late 1960's,single-strand aluminum (instead of copper) wiring became quite popular and was extensively used. Since that time, aluminum wiring has been implicated in a number of house fires, and most jurisdictions no longer permit it in new installations.
Do not panic if your house has aluminum wiring. Aluminum wiring, when properly installed, can be just as safe as copper. Aluminum wiring is very unsafe if improper installed. We will address some of the theory behind potential problems, and what you should do to make your wiring safe.

The main problem with single-strand aluminum wiring is a property known as "cold creep". When aluminum wiring warms up, it expands. When it cools down, it contracts. Unlike copper, when aluminum goes through a number of warm/cool cycles it loses a bit of tightness each time. To make the problem worse, aluminum does oxidize, or corrodes when in contact with certain types of metal, so the resistance of the connection goes up. Which causes it to heat up and corrode/ oxidize still more. Eventually the wire may start getting very hot, melt the insulation or fixture it's attached to, and possibly cause a fire.
Since people usually encounter aluminum wiring when they move into a house built during the late 60's and early 70's, we will cover basic points of safe aluminum wiring. We suggest that, if you're considering purchasing a home with aluminum wiring, or have discovered it later, that you hire a licensed electrician or inspector to check over the wiring for the following things:

1. Fixtures, outlets and switches directly attached to aluminum wiring should be UL rated for use of aluminum wiring. The device will be stamped with "Al/Cu" or "CO/ALR". The latter supersedes the former, but both are safe. These fixtures are somewhat more expensive than the ordinary ones.
2. Wires should be properly connected (at least 3/4 way around the screw in a clockwise direction). Connections should be tight. While repeated tightening of the screws can make the problem worse, during the inspection it would pay off to snug up each connection. (Note that Multi-strand aluminum wiring is still often used for the main service entrance cable  and some 220 volt applications. It should also be inspected.)
3. "push-in" terminals are an extremely unsafe with aluminum wire. Any connections using push-in terminals should be redone with the proper screw connections immediately. 
4. Should there be any signs of overheating, darkened connections, melted insulation, or "baked" fixtures. Any such damage should be repaired. 
5. Connections between aluminum and copper wire need to be handled specially. Current Canadian codes require that the connectors used must be specially marked for connecting aluminum to copper. The NEC (National Electric Code) requires that the wire be connected together using special crimp devices, with an anti-oxidant grease. The tools and materials for the latter are quite expensive - not practical to do it yourself unless you can rent the tool. (Note that regulations are changing rapidly in this area. Suggest that you discuss any work with an inspector if you're going to do more than one or two connections.) 
6. A non-rated receptacle can be connected to aluminum wiring by means of a short copper "pigtail". See (5) above.

If and when considering purchasing a home, an inspection of the wiring shows no problems or only one or two, we believe that you can consider the wiring safe. If there are signs of problems in numerous places, we suggest you look elsewhere. If the wrong receptacles are used, you can replace them with the proper type, or use pigtails - having this professionally done can range from $3 to $10 per receptacle/ switch. You can do this yourself too.

Please be aware that a detailed inspection of the wiring is beyond the scope of many inspectors.