If you can't wait to experiment with the endless possibilities that using webcam streams with canvas can give to developers, the annotated source code is just waiting for you - take a look at the example usage, then download the library and have a blast!
This demo only works on the most recent versions of chrome, firefox (Aurora/nightly) and safari (possibly explorer too, but I would not vouch for it). Opera should really try to implement a requestAnimationFrame, instead, in particular now that they support WebGL.
Some browsers will ask you for permissions to use your webcam: accept it in order to see the demo in action: feel free to check the code before activating it. Spoiler: nothing will be sent anywhere, it's between you and your browser.
Note for chrome 12 users: you might experience some performance issues. If you want to solve them (and feel adventurous), take a look at chrome://flags and get freaky checking all things 2d- and video- acceleration
Here are some useful resources to learn more about HTML5 video, canvas, WebRTC and how they work together