I've heard from many sources that coffee makes you dehydrated, which seemed as reasonable as anything, until one day I read that the volume of liquid was way higher than the dehydrating effect, which also made sense. But alcohol definitely does dehydrate you. So what's the real answer?

Although there are a lot of results on a google search for the answer, I wanted something I felt was at least a little reliable. So the key answer I found was at the Mayo Clinic. Their response? "[C]affeinated fluids can contribute to your daily fluid requirement", but "caffeinated drinks can cause headaches and insomnia in some people. Water is probably your best bet to stay hydrated."

Once I felt I had the key findings, I felt better equipped to search out some additional information (the Mayo response is rather terse). Snopes helped round out the details, with their response to the '8 glasses of water a day' rule. "In a study published in the October issue of the Journal of the American College of Nutrition, researchers at the Center for Human Nutrition in Omaha measured how different combinations of water, coffee and caffeinated sodas affected the hydration status of 18 healthy adults who drink caffeinated beverages routinely. 'We found no significant differences at all,' says nutritionist Ann Grandjean, the study's lead author."

So the long and short? Drinking (non-alcoholic) liquids is good, water is probably still best.

Addtional information on this topic can be found at the New York Times and in an article from the FDA. An older FDA document, which dates from 2007 and also contained many facts about caffeine, perpetuated the idea that coffee causes dehydration. So the research on this topic continues to evolve.