Yep, it should be able to run Leopard pretty well. Make sure you have enough RAM...more is always better at the levels available to these machines. I believe Apple officially says it can take a maximum of 1 GB, but it can unofficially use 2 GB. The full 2 GB should give you a very nice system with Leopard. 1 GB should be okay, but you may notice some sluggishness at times.
Of course, that's probably true if you're running Tiger on it already, depending on what you use the machine for.