I see quite a lot of live music at pubs and festivals, and have seen about a bajillion cover bands, most of which are pretty bad. The odd time I see a really good tribute act, though and I find myself blown away, even if the real band isn’t a particular favourite of mine. Tell me what truly good tributes you’ve seen!
In college, I saw Almost Queen.
They played at the Student Union, and it was a ton of fun for the audience–and it looked like the band was having the time of their life. IIRC, we looked up where else they’d been playing recently, and it was a lot of corporate gigs. It seemed like they were really pumped to play for a bunch of crazy college kids.
I have all the reverence in the world for Queen–I grew up listening to them nonstop with my mom, I know all the words to even the lesser-known stuff, and they are probably my favorite band if I had to pick. But this was a good time with a tribute band.
ETA: I think what made them stand out from others is “Freddie” used to perform on Broadway, so he had the chops to make it something special.
A grateful dead cover band from st louis.
I have been seeing them for a Loooonnng time. They are quite good.
I saw Cubensis, another Grateful Dead cover band, just last night. They are a lot of fun.
Some students at my highschool started covering Supertramp, and were so good that when listening, I could not tell the difference.
Beetlemania in Key West. They were very good. They were the major float personages for the Fantasy fest parade too.
I saw Bjorn Again (ABBA tribute) on the main stage at the Reading Festival. They were very entertaining, and rather stood out on a bill that day that also included Nirvana, Nick Cave and the Bad Seeds, Mudhoney, The Beastie Boys and Pavement.
The Fab Faux doesn’t try to imitate the Beatles look (just to show that: there are five of them), just the sound… and they are superb.
Hairball covers a variety of hair metal bands pretty well.
They have two lead singers; one sings while the other goes backstage to change costumes!
The Musical Box has to be one of the greatest tribute bands in the history of tribute bands. If not the greatest. They painstakingly, meticulously re-create Genesis shows from the 1970’s, those with Peter Gabriel, and up to post-Gabriel Trick Of The Tail. They use the same set lists, lighting and costumes (often with the detailed help of Genesis members themselves as well as huge, long-time fans). It helps too that they’re excellent musicians and that the lead singer sounds like Peter Gabriel AND Phil Collins from that era.
Any Genesis fan who ever pined that they never saw one of the Peter Gabriel concerts, or the Trick of the Tail show should not miss this band. I was lucky enough to see Genesis twice with Peter Gabriel, for the Selling England By The Pound tour and the Lamb Lies Down On Broadway tour. I saw Musical Box perform the Lamb tour (twice) and it’s perfection. Well, near perfection, since they aren’t actually Genesis. But it’s as close as anyone will ever get now.
Examples (there are tons more on YouTube):
The Lamb Lies Down On Broadway excerpts
Firth of Fifth!!
The Knife
Can Utility and the Coastliners
Trick of the Tail excerpts
The Wholigans (Warning: turn your volume down) are awesome, but not as good as the tribute band that has toured with some of the original members. 
There’s a band from Santa Cruz called The White Album Ensemble that does fairly accurate renditions of whole Beatles albums. I saw them play Rubber Soul and Revolver and it was pretty impressive.
Rain. We saw them in a New Year’s Even concert at Keller Auditorium in Portland.
Wow, just wow.
I’d highly recommend No Quarter, a Led Zep tribute band in the NW. Not only is their playing excellent, but they also try to recreate the pacing of a Zep concert. For example, instead of just performing “Whole Lotta Love” like the album version they do it as a 10-minute+ jam–just like Zeppelin themselves.
I also remember being impressed by the Speedles, a band that did punk rock versions of Beatles songs. Their playing was pretty good, but what really stood out was their showmanship; they had multiple costume changes from three piece suits to choral robes. Unfortunately they have apparently split up.
I saw the Soft Parade maybe 10 years ago. The singer was creepily similar to Morrison; the keyboard player looked kind of like Ray Manzarek; the guitar player didn’t look too much like Robbie Krieger unless he got in front of a light, which would accentuate the frizz of his hair. But they were certainly able to create the feel of a Doors show (and this was in a small club, making it even cooler)… and you really don’t realize how powerful some of those songs are until you see them live. “Not to Touch the Earth”, for example. I’m planning to see them again this fall so we’ll see how well they’ve aged.
Hell’s Belles, an all-girl AC/DC cover band, are brilliant.
I’ve seen the local-ish Beatles tribute band The Sun Kings several times and always enjoyed them greatly. Four years ago at the Monterey Pop Festival 40th anniversary show, though, they were truly outstanding. They played the entire Sgt Pepper album, in costume, with orchestra where appropriate, clarinets on “When I’m 64,” and Indian instruments for “Within You Without You.” (They cheated on “She’s Leaving Home,” though, and played the harp part on a keyboard.) For their encore, they played “All You Need Is Love” complete with the horn section, and had a woman dressed like Yoko Ono (short white dress and big white floppy hat) leading a procession of children carrying signs with “All You Need Is Love” in various languages, in a nod to the original 1967 satellite broadcast. I was literally in tears.
Ticket to Ride comes here (LA) about once a year. Really good show, complete with costume changes to show the Beatles through the years.
U2 Nation and Maiden NY, both out of the NYC area are excellent.
I saw Cold Gin, a Kiss Tribute band on Halloween Night in the early 90’s and they were awesome*. I spotted Gene Simmons lurking in the back of the auditorium and wouldn’t you know it, Kiss came out of retirement right after that!
*Awesome if you don’t think Kiss sucks.
The Hounds of Love are the best Kate Bush tribute band I’ve ever heard. There are others that are more about the theatrical elements - these folks just concentrate on the music and do a great job of it. Interestingly, they are managed by the road manger of Kate’s one and only tour.