Sure, we use it everyday and it's almost overlooked!
Compare having 2 PCs in different rooms, but connected by a cable through the wall. You can share files, printers, internet connection, etc. on these two PCs right? Now think about a phone line. You do the same thing when you have a couple of phones in different rooms sharing a phone line.
The cabling is even similar. You need to be careful about doing this. The cable may already be there but I seriously doubt you have CAT5 running through house for your phones. Not that you need CAT5 for computer networking, but it has become the standard. Although, the type of cabling used for your phone line (most likely CAT3) can be used for networking....this type of cable is meant for voice and telephony applications and interfaces. I don't think you'll like the results when you try to use this for common PC networking. But, if you'd like, just snip the RJ-11 adapter you have on the phone line and then strip the cable. Then crimp the RJ-45 adapter on the cable and make sure that you are pairing pins 1 & 2 and also 3 & 6. These are the send and receive pins. If I have a cabling job, then I usually use the phone lines in place as a guide and then I follow these lines around the house and use a similar "drop-point" when I need to bring it down to an outlet.
-Mike