To configure Pathauto to have language-specific path aliases, do the following:
admin/build/modules: enable Locale and Content Translation modules
admin/build/block: enable the language switcher block (this is required since your path aliases will only show in the currently active language, the rest will show as unaliased)
admin/settings/language/add: add a couple of new languages - say French and Spanish
admin/settings/language/configure: change the 'Language negotiation' setting to 'Path prefix with language fallback'
admin/content/types: edit the content types that require translation and set the 'Multilingual support' setting to 'Enabled, with translation' - the setting is in the 'Workflow settings' fieldset
admin/build/path/pathauto: add new, language-specific patterns for the node types, say article/[title-raw] for French and artículo/[title-raw] for Spanish
node/add/story: create a new item of content, and set the language to English (or whatever your default language is)
node/NID/translate: click the Translate tab and then click the 'add translation' link for each language that you wish to have a translation
The big thing to keep in mind here is that for the paths are per language so for them to work you'll need to switch languages. Thus the language switcher block is required. If everything is set up right clicking on the Spanish link should take you to 'artículo/' and the French link 'article/', when you are in the respective languages.