Subclipse in Mac OS Lion shows "Unable to load default SVN client" error

Have you tried downloading SVNKit from the update site of Subclipse?

Go to Install New Software and select the Subclipse update site. Select the JNA and SVNKit library as well as the SVNKit Client Adapter.

After, change the interface from JavaHL to SVNKit in the Preferences → Team → SVN → SVN Interface.

For anyone receiving the error:

Incompatible JavaHL library loaded.  1.7.x or later required.

Using the latest Eclipse Indigo standard 3.7.1 and the latest Subclipse plugin from CollabNet (Collabnet Desktop 3.1.0 for Eclipse 3.5-3.7) for OS X, the problem is not the version of the Subclipse plugin files, it is the actual version of Subversion you have installed. Collabnet does not yet offer the 1.7 SVN package for OS X, you need to get it from WanDisco.This messed me up for hours.