The most common urban myth is that she is "really" a Latina actress named Maria Cruz, who was born in 1947 in California and sent by Brando to refuse his Oscar. pingouin takes this story to its logical conclusion, claiming that Marlon Brando created her and that she was an art piece that he performed. Well, not quite.
Sacheen Littlefeather was born Maria Cruz in 1947, but beyond that not much about her life conforms to the rumours. Her mother was white and her father part Apache, part Yaqui. She was born on a reserve in Arizona into conditions typical of such environments: her parents were very poor, her father physically and sexually abused her, and she attempted suicide at age 9.
When Brando's name was announced, the audience cheered, but they soon started to boo as Littlefeather appeared. Liv Ullman and Roger Moore were to present the award to Brando, and a famous photo shows them looking completely nonplussed as Littlefeather holds out her hand to decline the statuette. (Moore was so freaked out by the whole thing that he took the little gold guy with him to Mexico before realizing he still had it.) Littlefeather had been forbidden to read Brando's full speech by producer Howard Koch ("If you try, I'll cut you off the air," he apparently hissed at her), so she made a short statement.
Sacheen Littlefeather currently resides in Northern California and is available for interviews, appearances and speaking engagements. This is the only website that will allow you to communicate with her about such matters. All other websites or email boxes are fake and unauthorized.
Contrary to misinformation which has been published on the internet, Sacheen Littlefeather is indeed of true Native American Indian descent. Sacheen was born Marie Cruz in Salinas, California. Her mother is French-German-Dutch, and her father was from the White Mountain Apache and Yaqui tribes from Arizona. "Cruz" is her father's recognized tribe name. Sacheen took the name "Sacheen Littlefeather" after high school to reflect her natural heritage. She is not a "Mexican actress" as Roger Ebert incorrectly reported.
Imagine denouncing Native stereotypes to a billion or whatever viewers. I don't know if it had an effect, but stereotypes in movies started disappearing (slowly) around that time.
More important, everyone who saw this moment remembers it. This shows the power of popular culture to have an impact on people.
For more on the subject, see The Best Indian Movies.