Tai Chi is not very similar to martial arts such as karate and judo (as I understand it) because you are not taught 'moves' and 'tricks' for fighting. Instead you are taught the 'form' (of which there are several, such as tai chi chuan). Each form is a series of movements which, when watched, is similar to a dance. All movements within the form are circular in nature (somewhat hard to avoid), and this emphasises a particular way of looking at movement, both yours and that of other people that lets you see how to take advantage of openings in other peoples defenses if they attack you. Of course, the form (which is normally enacted slowly) can be speeded up and 'hardened' to become seriously deadly to anyone who is standing in front of you (or behind you, or next to you, depending on how you do it).
The central focus of 'fighting tai chi' is to get the other guy off balance, and therefore onto the ground, following the (highly effective) logic that someone fallen flat on the floor in front of you is very easy to disable (can anyone say 'drop to your knees on them'?) so a basic tai chi response to someone trying to punch you is to deflect their blow and trip them.
Tai Chi has this emphasis of 'floor=death' because it is primarily a close quarters martial art. Any fighting method that always leaves a decent gap between fighters gives a fallen figher time to get up before they are killed. Because of the close combat philosophy behind Tai Chi it is very useful in any kind of mass combat (i.e a bar brawl or, say, any real fight).
As such it is to be considered a very bad idea to get into a fight with someone who is good at tai chi, as your chances of coming out of it without broken bones are very slim indeed.