The first time I read about it was actually in a magazine in the seat pocket, when I jetted to CA this summer. There was a nice feature article on a neighborhood carshare. They were really "together" though...insurance, the online network to book one of the cars. I think they had a fleet of 10 though.

I'm more interested in something even smaller scale.
As a new bicycle commuter, and living in an area that experiences a lot of ice in the winter, I'm exploring different options for transportation to 40 lb. bags of dog food home, or get across town without needing 2 hours to walk there. Currently I borrow rides, or use the bus, but mostly bicycle or walk where I need to go. Car rentals are options for long distance, as with any location.

But I like the idea of a neighborhood having a carshare. The neighborhood where I live is one block long (meaning the street name ends and begins on the same block). The neighborhood tends to share lawn mowers, have potlucks, pet sit, and go in together on things like speed bumps and sewer snakes. A lot of our block bicycles, so I think we are a good candidate for a carshare program.

Also to answer your question, daveed...a lot of larger metro areas have their own version of carshare.
For example, Chicago has I-Go (www.igocars.org/ )
San Francisco has City CarShare (www.citycarshare.org/ )
St.Louis has WeCar (www.wecar.com/)
A smaller program in Rutledge, MO is called Dancing Rabbit Vehicle Co-Op
(www.dancingrabbit.org/drvc/)

Flexcar and Zipcar are all over the place.
My BF lives in Santa Barbara, and there is a carshare program there, but it's only for university employees.

They are popping up all over the country.
www.carsharing.net/