Does @font-face work in email templates?

You can! But with all things cool in html-email it will not work in every client/browser.

@font-face will work in iOS and (most of) Android's default clients, Apple Mail, and Outlook 2011 for Mac. Everything else either strips your whole <style> tag or just ignores it.

Some precautions: font-face freaks out Outlook '07-'13, so wrap your font-face CSS in it's own style tag, in an MSO conditional. Make sure you use all types of font files in your @font-face- otf, ttf, eot, svg so it works across browsers. Then make sure you have good fallbacks when you try and use it. At the least you should have font-family:'Custom Font',sans-serif; (or serif).

<!--[if !mso]><!-->
<style type="text/css">
    @font-face {
    font-family: 'Custom-Font';
    font-weight: 400;
    font-style: normal;
    src: url('http://somethingdoodad.biz/fonts/Custom-Font-Regular.svg#Customfont-Regular') format('svg'),
         url('http://somethingdoodad.biz/fonts/Custom-Font-Regular.eot?#iefix') format('embedded-opentype'),
         url('http://somethingdoodad.biz/fonts/Custom-Font-Regular.woff') format('woff'), 
         url('http://somethingdoodad.biz/fonts/Custom-Font-Regular.ttf')  format('truetype');
    }
</style>
<!--<![endif]-->

One gotcha is Cross-origin resource sharing (CORS). For at least Thunderbird you must make sure that the remote server (that hosts the font) sends a HTTP header like:

Access-Control-Allow-Origin: *