The H1 tag is designed to tell the page topic. As the text on this tag describes your page content, search engines considered this tag as your page title and they give more weight to terms designated by this tag. Also note that use of many <H1> tags may dilute the importance of your page and cause problems in evaluating pagerank of your site.
By default <h1> tag is realy big and may not suit to your page layout. But you can use CSS to define the format of <h1> tag so that it fits in with your overall design. See some examples below:
1) Use <h1> tag only once in a page
2) It should be at the top of your page
3) Avoid using class attribute within the <h1> tag (eg: <h1 class="exmp">your header</h1>)
4) Avoid graphical titles, use all six header tags instead
5) Avoid use of other tags inside the <h1> tag (eg: <h1><span class="text">your header</span></h1>)