The Collaborative International Dictionary of English v.0.48:

Rathskeller \Raths"kel`ler\ (r[aum]ts"k[e^]l*l[~e]r), n. [G.,
   also ratskeller, prop., town-hall cellar.]
   Orig., in Germany, the cellar or basement of the city hall,
   usually rented for use as a restaurant where beer is sold;
   hence, a beer saloon of the German type below the street
   level, where, usually, drinks are served only at tables and
   simple food may also be had; -- sometimes loosely used, in
   English, of what are essentially basement restaurants where
   liquors are served.
   [Webster 1913 Suppl.]

WordNet (r) 3.0 (2006):

rathskeller
    n 1: a tavern below street level featuring beer; originally a
         German restaurant in the basement of city hall