When designing a board, power is always a concern. Not matter if the power supply is batteries or a wall wart, you have to consider how the user is going to attach the power supply. Given the opportunity, we have to assume that power will be hooked up wrong. This brings up the discussion of 'reverse power protection'.
How would you design a circuit to withstand having the power applied backwards?
If you've ever plugged in a chip backwards, a wallwart backwards, or shorted VCC to GND, you know what we're talking about. And if you haven't hooked something up backwards, you're not human.
Chris Anderson recently brought up this discussion with me over the ArduPilot. This small board is a good example of the different options available. You can see the small BAS16 diode highlighted in the above Eagle PCB layout. This small diode is designed into the product to protect against reverse polarization. If someone hooks power up backwards, the diode fails to forward bias and the board simply doesn't turn on, protecting it from damage.
1) Inline protection diode: The problem is the forward voltage drop of the diode. Cheap diodes have a theoretical 0.7V drop. So if you hook 5V up to the board, you'll get 5-0.7=4.3V delivered to the board. In practice, the forward drop of the diode is actually a bit lower (0.5V) and there are specialty diodes available that have even lower forward drop (germanium?). This all works great if your incoming power is 2-3 volts higher than your output, but if you're running a 5V board from a 5V source, the diode will drop the voltage to your system down significantly.
Checkout the Eagle DFM tutorial for more information about labeling your board.
LDO Voltage regulator with two 10uF tantalum capacitors
3) Voltage Regulator: The nice thing about many voltage regulators is that they have short circuit and reverse polarization protection built in! We love the Micrel part (MIC5207). You can do some really mean things to this SOT-23 v-reg (shown above) and it will survive and protect the electronics behind the regulator section of the power supply. These regulators are better than a diode because the forward drop of the MIC5207 is ~100mV under load - much less drop than the diode option. The problem is that a voltage regulator can handle less current (180mA max), is physically larger (with required caps), and is more expensive ($0.50 vs $0.07) than a similar sized diode.
Note: Reversing the voltage on electrolytic or tantalum caps is a bad thing. A 16V rated tantalum may "pop" (explode with great force) if you apply 10V the wrong way. Electrolytic caps won't explode as violently, but may expand or puff out a bit.