First of all I need to say that I'm not sure whether this is an Ubuntu issue or a WordPress issue, but I've got to start somewhere so am trying this forum first.
I've just created a new WordPress site (I'm even newer to WordPress than I am to Ubuntu). The site was successfully set up on the live domain (on a remote server with a web hosting company). I've copied it across to my own Ubuntu 12.04 server in order to try and continue development offline. I've copied all the files and the database, and have a script that automatically changes all the URL references in the database records. The home page of the local site loads OK in a web browser.
WordPress has been set up to use permalinks - the .htaccess file was automatically generated on the live site and the permalinks work OK, so I can only presume that the syntax is correct. The .htaccess file was copied along with everything else to the local server, but the permalinks do not work in the local environment. I've checked the file permissions for .htacess and they are set to 664.