Dungeons are underground chambers with cobblestone walls. They usually contain some chests with items (for players to collect) and a Mob Spawner. Dungeons are possibly the only place that saddles can currently be found, as well as mossy cobblestone and mob spawners. Dungeons are also called "Ruins" by players. They are always found below sea level. An easy way to find one is to look underground for cobblestone you didn't place, or an area where a lot of one mob is coming from. Dungeons do not always contain saddles. Mob spawners cannot be picked up as of a recent update.
Dungeon Game Mode
Dungeon may be an upcoming game mode planned by Notch. Not much is known about it, but it will be like Survival mode. The player won't build blocks, only destroy some of them. It has also been said it will have new mobs and puzzles. It is planned to be released after the game.