Nowadays the MIME Type in the header of the file is enough to tell most browsers that it is a style sheet of type text/css. It's pretty much de facto.
rel attribute reaches well beyond just CSS files. It relates all manner of external resources to the document. It is especially important in navigation but unfortunately never got fully explored by most vendors, Opera being the one that went the full distance.
Be sure to read up on the attribute on the W3C site.