Does overheating cause a computer to slow down?

Most modern processors do reduce their clockspeed when they get warm to try and cool themselves. I think it all started off with laptops and having dynamic fans and powersaving etc, but as they all pretty much run off the same set of chips then they've all started doing it.

I used to have a fanless laptop that ran at 1.1ghz, unless it was warm and then it dropped down to about 300mhz until it cooled down!

It can cause 'slowness' as described in mat1t's answer, but it will definitely significantly reduce the MTBF of most parts if they are continually overheated.

I use a program called DTemp to monitor my laptop's and desktop's hard drives' temp, and I definitely see a slow down when the drive reach about 102F or greater. I am sure different drives have different thresholds. If I blast an external fan at my laptop and bring the temp back down to under 100F, I have a zippy machine again.

Edit: The DTemp homepage appears to be gone and no one seems to have the download available. If anyone knows where to get it, please post in the comments.