He could've meant that sarcasticly.

When Han Solo calls Jabba human, he probably was just being the wise ass mercenary that we all know and love!

Yeah, because Han NEVER jokes around

You (well, obviously not you PERSONALLY) can tell by Han's tone of voice and the nature of the conversation that he was being sarcastic. He also said Jabba was wonderful. He really thinks Jabba is wonderful? Sarcasm. He says Jabba is a human? Yep, sarcasm again.

All Wrong

In the original script, Jabba the Hut WAS ACTUALLY A HUMAN. If you ever watch The Making of Star Wars, it will explain the difficulty they had in one of the scenes where Han walks around Jabba. At the time they shot the scene, Jabba was Human so they had no problem walking over his tail because he DIDN'T HAVE ONE. After they made him an alien, however, they had to edit it so that he looked like he went UP after stepping on the tail.

What it means to be human

To elaborate on the sarcasm remarks, to be a great human being means to be giving or generous. Jabba is certainly not either of these things. When Han said that he was a wonderful human being, he was sarcastically refering to the lack of generousity displayed by Jabba, not Jabba's race or physical origin.

This one should not be here.

This one has already been pretty much beaten to death. But there is one extra problem with it: it was posted to the wrong movie! It should have been sent to the SPECIAL EDITION version!

Actually, that's wrong. Jabba was never scripted as a human. He was originally scripted as a "generic humanoid creature", possibly something hairy, similar to a wookie, or something along those lines. They then had a human in fur-covered rags stand in during the shooting of the scene, but later decided that they'd make Jabba more "exotic" and turn him into a slug-like creature. Jabba was never scripted as a true human.