I just wanted to add that I felt Tanenbaum's Modern Operating Systems was a tad light on some of the core topics (especially when trying to get a good grip on the issues behind concurrency). I personally recommend the book by Silberschatz: http://www.amazon.com/Operating-System-Concepts-Abraham-Silb...
I also think for understanding how operating systems work, nothing beats writing your own! I learned most of the concepts by building a toy OS during the better part of my undergraduate studies. I highly recommend this for people who like coding and are afraid of jumping into the theory too quickly. For example, analyzing memory allocation algorithms is never as interesting as when you have to pick one for your own kernel!
I also think for understanding how operating systems work, nothing beats writing your own! I learned most of the concepts by building a toy OS during the better part of my undergraduate studies. I highly recommend this for people who like coding and are afraid of jumping into the theory too quickly. For example, analyzing memory allocation algorithms is never as interesting as when you have to pick one for your own kernel!