To change the port that GeoServer runs on, open the file:

$GEOSERVER_HOME/etc/jetty.xml

for GeoServer 1.4.x. For older versions it's at:

$GEOSERVER_HOME/documents/jetty.xml

and search for '8080'. Change it to a port that isn't in use, and is greater than 1024, as ports less than or equal to 1024 require superuser access to bind to. Restart GeoServer and you're in business. Be sure that you always replace the "8080" in the URL you're using to access GeoServer. For example, if you change the port to 1979, you would request the URL to

http://localhost:1979/geoserver