- Do not use public domain images for an illegal purpose.
- Identifiable people may not appear in a bad light or in a way that they may find offensive, unless they give their consent.
- Do not suggest endorsement of products, services, etc. by depicted people or organizations. For example: do not use an image of NASA and place it adjacent to your own product in a way that suggests NASA would recommend the product.
In addition to these common sense regulations, there is more to know:
Model- and Property Release
Imagine: would you like to see your face in a TV spot without being asked for permission? No?! Therefore, identifiable people must give their consent for public usage of their images. This is meant by the term "Model Release".
The same goes for private property: Would you like to see your private home displayed for example on an advertising column without prior notice? Nope? That's the reason for the so-called "Property Release". The object owner must give permission to use pictures of his/her belongings. But the Property Release also covers special cases, where designs or seemingly public buildings are protected. Examples are designs of new notebooks or mobile phones, as well as the Chrysler Building in New York or the London Eye. If you'd like to use pictures of that, the creators/owners must be asked for permission. Getty Images offers a large and highly useful database for looking up intellectual property release requirements: http://wiki.gettyimages.com/
However, there is a difference between editorial and commercial use. Model- and Property Releases are particularly important for commercial applications. If you are i.e. showing an image on your blog, it is non-commercial, editorial usage. In general, no release is required for such applications. Commercial use is loosely defined as all sorts of businesses, where you are actually selling something, or if you use images for advertising purposes. Take particularly care, when it comes to huge quantities, e.g. if you were to create an advertisement in a famous magazine or if you were to design a new iPhone cover.
Conclusion: It all may seem terribly complicated or risky, but actually, it isn't. Simply put yourself in the position of a depicted person or in the position of an owner or designer, respectively: Would you approve of the intended application without being asked? That is the question you should always ask yourself before using a public domain image without release.
So what is public domain anyway, if I still have to ask for permission?
Understand "public domain" as the permission to freely use an image without asking permission from the photographer or the illustrator. Thus, the creator of the work will not sue you for violating his/her copyrights. The creator, however, is not responsible for the content of the picture. It is your responsibility to make sure, displaying the image does not violate any other law. That is the essence of public domain images.