There has been a run on iodine pills in Hawaii, Finland, and some European countries where people are expecting trips to Japan or are worried about Nuclear fallout.
Iodine may be used in radioiodine-contamination emergencies, such as nuclear accidents, to "block" the thyroid's uptake of radioiodine.
Potassium iodide was approved in 1982 by the US FDA to protect the thyroid glands from radioactive iodine from accidents or fission emergencies. In the event of an accident or attack at a nuclear power plant, or fallout from a nuclear bomb, volatile fission product radionuclides may be released, of which 131I is one of the most common by-products and a particularly dangerous one due to thyroid gland concentration of it and this may lead to thyroid cancer. By saturating the body with a source of stable iodide prior to exposure, inhaled or ingested 131I tends to be excreted.
Potassium iodide’s value as a radiation protective (thyroid blocking) agent was demonstrated at the time of the Chernobyl nuclear accident when Soviet authorities distributed it in a 30 km zone around the plant. The purpose was to protect residents from radioactive iodine, a highly carcinogenic material found in nuclear reactors which had been released by the damaged reactor.
Potassium iodide cannot protect against any other causes of radiation poisoning, nor can it provide any degree of protection against dirty bombs that produce radionuclides other than isotopes of iodine. Also, using common table salt is not an effective substitute. Even with that, salt supplies have been almost completely depleted in stores around Japan.