No longer held in San Francisco, or even California (Nevada), the Burning Man festival is a big part of San Francisco life for many residents. The event is a week long and held on a dried lake bed - attracting upwards of 50,000 people annually and otherwise defying brief description.
Check out the photos, research it online - if you're inclined and able, journey to the playa! Whatever your experience, it will be memorable.
There are a variety of Burning Man related and inspired events throughout the year, the largest is Decompression. The Squidlist is a reliable way to find others... and/or check out the Gothic Raygun Rocketship at Pier 14 until October 2011!
Website: http://www.burningman.com/
Wikipedia: http://en.wikipedia.org/wiki/Burning_Man