For the longest time, I mean going as far back as 1994, the standard width of a website was 800px. The rationale behind this was that in the olden days of the Internet, most user's monitor screens were as small as 800px by 600px, and even users who had wider monitors displayed their browser in a window that didn't take up the full screen. 

Then around 2001 I remember reading somewhere (no, I don't remember where) that 1024px was a new comfortable standard due to increasing average monitor size and standard resolution settings (better video cards). This allowed 800px for main content and 200px for side content (ie. menu, advertising banners). This has remained the standard in web design since.

But now nearly 10 yrs later, does that logic still hold? According to the Steam Hardware Survey 85% of screen resolutions are now larger than 1024 x 768. Similarly, the Browser Display Statistics analysis by W3 Schools indicate 36% of users have a display resolution of 1024x76 ...and 57% have higher. As a web designer/developer here's my take on it all.

Website Design still should use no more than 1024 pixels of width. Even though the average resolution size is growing most people still don't view individual content wider than 1024. So sure you can use a "liquid" layout that can expand or contract to use more or less space, but it should not require more than 1024 pixels to display.

The bulk of your content should fit into the leftmost 800 pixels of width.  Especially If your audiences are left to right reading and you are displaying graphics or multimedia. You want to follow the natural path of the eye whenever possible. K.I.S.S. 

Make sure you consider smaller resolutions for mobile phones and similar apps. The cell phone industry is growing at exponential rates. Data transfer speeds double every year and with this new speed more and more people are going online via one of the various mobile Internet devices on the market. Most new Content Management Systems have technology built into them to determine user browser or device resolution and adjust the web site accordingly.

In my opinion there are only guidelines when considering site size though many new sites are pushing the boundries of width and height standards. Here's a few:

http://www.thehorizontalway.com/

http://www.180degrees.co.uk/180degrees.html

http://deanoakley.com/

http://www.faub.org/