You can write whole games in Python using [http://www.pygame.org/ PyGame].
If you have an existing game and want to add a scripting engine to make it more flexible, Python is also a very good choice. But you'll have to learn about IntegratingPythonWithOtherLanguages.
Read [http://www.onlamp.com/pub/a/python/2002/07/11/pythonnews.html Humongous Python] for a case study.