Anti-evolutionists get a lot of mileage out of this chestnut because it uses scientific terms like “thermodynamics” and “entropy” to bolster their contention that evolution is unscientific. In fact, local increases in complexity/order are not only completely consistent with thermodynamics, but even expected by the theory. Nevertheless, anti-evolutionists contend: “Evolutionary theory stands in obvious defiance of the Second Law” and “Evolution teaches that life increases in complexity, and therefore defies the second law. …The second law says that everything in our world and in the universe is like a wound-up clock that is running down” (http://www.pathlights.com/ce_encyclopedia/Encyclopedia/18law03.htm or http://evolutionfacts.com/Appendix/a25.htm; see also http://www.cryingvoice.com/Evolution/Physics.html (link broken)). This ruse works best with an audience that is already inclined to hope that evolution is not true, and requires that the audience does not already understand thermodynamics. This burdens the defender of evolution with having to explain not only all of evolutionary theory but thermodynamics on top. I’ve found that the following explanation often works pretty well to help folks understand basic implications of the Second Law as it relates to life on earth and evolution.
The Second Law of Thermodynamics has to do with entropy — the entropy of the universe increases during any spontaneous process. A traditional way to understand this is that disorder increases in an isolated (closed) system. This is where some muffins come in handy.
One caveat: Do not look for the muffin example to cover all of physical theory comprehensively. It discusses entropy in terms of the classical theory of thermodynamics. Quantum mechanics and relativity theory put a different spin on it. Since we do not really have conservation of energy in general relativity, it is hard to say what a really comprehensive thermodynamics will look like once the physicists work it out. However, the more Einsteinian versions of thermodynamics thus far all look far worse for the anti-evolutionist objection than does the classical theory. For a more advanced treatment of classical thermodynamics, see http://www.entropylaw.com/.