Well, aside from Ahmedinejad pulling off the biggest upset since Truman beat Dewey, the main opposition figure just got put under house arrest and his supporters are being dispersed with revolutionary guards with pepper-spray.
Draw your own conclusion.
Edit: I'm reading sources suggesting that there was identical vote percentages at each polling place: that is, 65% Mahmoud EVERYWHERE in Iran. That is literally impossible. Elections don't work that way.
Re-Edit: Mousavi isn't arrested. But it looks like the opposition is going to call this thing out. It depends on Khameini.
Edit 3: There's a good piece on MyDD about all this by Shaun Appleby. I won't reproduce it here, but Shaun's contention is that this is proof that Ahmedinejad's faction within the Iranian oligarchy has won out. He was able to bring around enough officials and power players to pull off this rigging game, and it's that control of the players that matters, not so much the election itself. The Mousavi /Rafsanjani/Khatami faction has lost its power to do anything about this, and so have proven their weakness.
I think that's correct as far as it goes. But the problem is that in places like Iran, you still need at least the illusion of a democratic process to take place. The elections in the past have been sketchy, yes, but still roughly accurate. This one beggars belief, and states to all and sundry that any future elections are absolutely meaningless. Even if Ahmedinejad has brought a good chunk of the oligarchy on board, he still has to worry about the public, and they could get very angry, indeed. If Iran becomes ungovernable, he'll have achieved nothing.