Brian Welcker, writing for his own blog Direct Reports, had a good post about knowing when a project is headed for trouble. The lens for his post is his experience on Microsoft's file system project named WinFS. The best part:
I suspected from early on that the project was doomed to failure. What made me think this? Because when I would ask anyone involved with the project the question "What is it?", I would get a very different answer.
If your project's goal can't be answered relatively consistently or relatively easily by the people involved in the project, then you're probably in trouble. This is indicative of either having a project that is too big/unfocused/gnarly to be completed successfully, or a project that is too ill-defined for everyone involved to be effective in delivering on its goal. I've been involved in both types of projects, and trust me it isn't pretty.