See this article, from Lee McFadden.
Say you want to put the following html in a turbogears.flash message:
Test <b>Message</b>.
By default, you'll get a literal Test <b>Message</b> rather than the desired Test Message. You can change this by modifying your master.kid to use the Kid XML() function:
Change the line
<div py:if="tg_flash" class="flash" py:content="tg_flash"></div>
to
<div py:if="tg_flash" class="flash" py:content="XML(tg_flash)"></div>