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Where browsers have supported it, it takes the URL of an image as its argument. Netscape 3 and lower did not support background for table cells. Netscape 4 gives odd results when the table cell contains a nested table. I also remember that some versions of IE 4 and early 5 gave very peculiar results when the image was a jpg, but IE always handled a gif image just fine. IE 6 and Netscape 6/7 handle it just fine
Instead of a background attribute, (which can't even be deprecated because it was never in the HTML standard in the first place) I think it's much better to use the style="background-image:(url)" and "future proof" your code. The background-image: selector can be applied to ANY element, whether it's inline or block level.