I'm embarrased to say that despite messing around with web design for years, I've never fully understood CSS positioning - specifically the use of absolute positioning and the idea of a containing block.

You see, when an absolute positioned block is given a percentage width, it's width is calculated based on the width of the containing block.  This gets confusing when you realise the containing block is not the same as the parent block.  Versions of Internet Explorer prior to 7, and even Opera prior to version 9, calculated the width of an absolute positioned object based on the width of the parent block instead of the containing block.

So what is a containing block?  Very quickly, it's the first ancestor block (i.e. parent, grand-parent, etc.) whose position is set to relative.  If no ancestor blocks have a relative position then the width is proportional to the width of the browser window.

To get an intimate understanding of CSS positioning and absolute position, in terms that are easy to understand, refer to Web Design 101: Positioning.