(Edit 15 July 2011: JBoss AS 7 is here, and brings a huge improvement to class loading and memory management. It's not full isolation, but it limits the exposed contact surface between app server and app greatly, and massively improves class loading. Brilliant!)
If you've used a Java EE application server like Glassfish or JBoss AS for long, you will have experienced classloader leaks, though you may not have realized it.
If you've ever seen the error
java.lang.OutOfMemoryError: PermGen space at deploy-time, read the linked article above. If you have ever worked on the JVM, on app servers, or on EE applications, please read on.
Even if you haven't hit classloader leaks, you should be aware of the various ways Java EE applications can cause memory leaks in the server and what to do about them.