Business casual is generally an unofficial and poorly defined dress code for professional workplaces. In some cases it is the official workplace attire and very well defined by noting what is not acceptable rather than what is. However, there isn't always agreement over whether or not jeans are business casual.
While the rules of business casual tend to be more strict for managers and executives, some individuals such as Steven Jobs, are famous for including blue jeans in their definition of business casual attire.So famous in fact that there is a website dedicated to it at http://www.stevesoutfit.com/.
A quick image search using Google shows many examples of blue jeans as part of business dress. They also suggest that women have an easier time maintaining a professional look in certain styles of jeans. Loose fitting, decorated or faded jeans are all less likely to pass the test.
Another factor to consider is what goes witht he jeans. Worn sneakers can quickly drag a an outfit into street casual mode while a crisp button collared shirt can just as easily elevate it. Of course the boss and common sense may disagree, and they should be allowed to.
The short answer is that jeans can be business casual but the culture of each company must ultimately determine what is right for that particular environment. How the jeans are worn, the style and fit, as well as what they go with are all a large part of the answer to that question. When in doubt, stick with slacks or a skirt, until you know that it is safe to dress for business in jeans.