Basically, overheating is the only issue. And I'm not downplaying it when I say "only issue".
Uh...
What about system stability? Chip life and performance? OCing affects all of these, and not positively.
When you overclock, you run the FSB and/or clock multiplier at a higher rating. (so 333MHz FSB and 9x Clock for 3GHz to a 400MHz and 10x clocck for 4GHz). You can also (have to sometimes) raise the voltage put into the CPU (1.2V standard up to around 1.5V I think).
This increased work generates more heat. The more work, the more heat. At a certain point, a few things can happen:
1. System Failure. Your computer will crash (BSoD) because the CPU cannot handle the settings you have put it up to, and the motherboard shuts it down to prevent serious hardware damage
2. Overheating. If your system is stable, OCing will produce more heat regardless. This WILL shorten the lifespan of your hardware, and (especially in a laptop) cause the rest of your system to heat up (thus decreasing their life)
3. Total Catastrophic Failure. This is not an official name, but it sounded cool. This is also really really hard to do. This is where your CPU basically melts by going WAY outside of its safe ranges. And no, it's not a joke. You can LITERALLY melt your CPU. While this will probably never happen (other things would break WAY before this), it is the ultimate failure.
Now, OCing can (ironically), in some cases, cause lowered performance and glitching. This may or may not be noticable, but had been known to happen (read the gaming/graphics cards forum). Certain programs may not work properly on an OCed system, or it may cause problems with the OS itself.
Because every part (even the same one) is different, there are different OC ranges per part and different reactions. Some can even be backwards and perform worse at non-stock settings.
In the end, OCing a laptop is just stupid (decreased battery life and heat being major factors).
Desktops are ideal, but you still need to know what you are doing.
Hope this helps.
~Lordbob