rar is provided in the multiverse component, so you must enable that repository. To do this, open up the Software Sources window in any of three ways:
- Press Alt+F2 and run
software-properties-gtk. (Use software-properties-kde instead if this is a Kubuntu system.)
- Open the Software Updater (or Update Manager, in older releases) and click Settings... at the lower-left corner of the window.
- Open the Software Center and go to Edit > Software Sources....

In the Ubuntu Software tab of the Software Sources window, under **Downloadable from the Internet*, one of the checkboxes is:
- Software restricted by copyright or legal issues (multiverse)
Check that box. You may be prompted for your password, to make the change. After you've done so and the box has a check in it, click Close to close the Software Sources window. Now try installing again.
(If it still doesn't work and you're installing from the Terminal with apt-get, try running apt-get update then attempting the installation again.)
How to find software with "no installation candidate"?
To find out why you might not have been able to install rar, the first thing I did was to go to packages.ubuntu.com and search for it.

Searching for rar in all supported releases (can also search one specific release).
The results revealed it to be in the multiverse component.

apt-cache search rarand see the results? – Ander2 Jan 17 '13 at 11:03apt-cache policy raris better ;) – Rinzwind Jan 17 '13 at 11:13