Steam's Offline mode is certainly not without it problems but generally it certainly works.
A few main problems though.
1. Do NOT shut down Windows with Steam running. A forum poster found that that can cut off steam's shutdown process prematurely, which causes a file to mess up, which forces the program to *have* to connect to fix Steam the next time it starts up.
Fix, manually close Steam before shutting down your computer.
2. If your internet is down, make sure you have no active network going. IE, if you're behind a router, that can still prevent Steam from going into offline mode, despite internet not working. Same with internet being down but not completely.
Fix, pull your internet cable or shut down your internet/network or turn off your router before trying to connect.
These things are on top of the obvious ones of course like saving your account credentials and having started the game while online at least *once*.
Fifeldor: Seriously, I've tried it in 3 different computers, and it always worked like a charm and without problems.
Fenixp: Well yes, that is great, except for when your internet connection crashes. You're pretty much screwed when not planning being offline ahead, well at least I know I always am.
Except, I can pull my cable just fine, with Steam running, or with Steam not running, and in both cases I'll be able to get into offline mode. Only situations where it doesn't work for me is when there's something wrong already to begin with, or in worst case I guess, if it'd cut off internet during an update of Steam or a game or something (hasn't happened for me)