I was going to post "suggested origin # 6" but I see Consuelo beat me to it with her citation of ...&Number=3087 above.

I'll still quote the relevent passage, though:

From the much-circulated "Life in the 1500's":

...Houses had thatched roofs -- thick straw, piled high, with no wood underneath. It was the only place for animals to get warm, so all the pets -- dogs, cats and other small animals, mice, rats, bugs, lived in the roof. When it rained it became slippery and sometimes the animals would slip and fall off the roof, hence the saying, "It's raining cats and dogs..."

along with the comment that, however appealing the explanation, it's been evaluated by snopes.com and found apocryphal. The relevent URL is http://www.snopes.com/language/phrases/1500.htm

Shucks.