Yesterday, I was listening to one of my favorite podcasts, Stuff You Should Know. The particular show was "How Octopuses Work". The article that inspired the podcast is here, and you can find the podcast in iTunes, Zune Marketplace, etc.
First off, apparently 'octopi', 'octopuses' and 'octopods' are all correct ways to refer to more than one octopus. Whatever you call them, they are pretty incredible creatures. Interesting things mentioned in the podcast: they often have three hearts and independent nervous systems for each of their eight legs, their suckers are incredibly sensitive and they can feel their way around reefs and "taste" the food they find, and they appear to be highly intelligent and may have individual personalities.
But the most interesting (and visually cool) thing is their ability to blend in with their surroundings. Their skin is covered with tens of thousands of pigmented cells called chromatophores. By flexing these cells, they can change color within a second. And it is not a single color but an array that helps them blend in with the background. They also have reflective cells call iridophores that help them mirror their surroundings. In addition to the ability to change color, they can also change the texture of their skin to add to the camouflage effect.
It was interesting to hear about how it is all done, but of course it is hard to beat actual footage. They encouraged listeners to go to YouTube and type in 'octopus changes color'. Here are a couple of the better, shorter clips that I found.