- Create a new Taxonomy:Term ID contextual filter.
- Under the form "When the filter value IS in the URL..." select the option "Specify validation criteria".
- Select "Taxonomy Term" as the validator.
- Select which of your vocabularies you'd like to use.
- Under "Filter Value Type" select "Term name converted to term ID".
That should do it. If you have multiple-word taxonomy terms, you should allow the contextual filter to convert dashes in the URL into spaces for the term name. If you have unusual characters in your taxonomy terms, see this post for tips.