Where did the ~/Library folder go in Lion?
The ~/Library folder still exists, but it is hidden. You can easily unhide it by running the following command in Terminal (/Applicatiions/Utilities):

chflags nohidden ~/Library


Note that you'll have to do this again after each 10.7.X update (credit to Vincent).

If you want to reveal it on a per-use basis, you can get in by holding down option and clicking on the Finder's Go menu.
Or, you can use Go-> Go to Folder and type in the path.
Or, you can open Terminal and type open ~/Library

The app Lion Tweaks gives you an easy GUI way to change this setting, as well as other hidden Lion preferences.