I found that jd-cmd does the job just fine, and works recursively in sub-folders for multiple files. To decompile a group of files on the command line, run the following commands:

1. Download the JAR file from here as the jd-cmd README.md file.
2. Create the directory where your output Java files will be located.
3. Run the command to decompile the files: java -jar jd-cli.jar -od <my-output-folder> <my-input-folder>.

I'd recommend Java Decompiler

Update February 2016:

www.javadecompilers.com lists JAD as being:

the most popular Java decompiler, but primarily of this age only. Written in C++, so very fast.
Outdated, unsupported and does not decompile correctly Java 5 and later

So your mileage may vary with recent jdk (7, 8).

The same site list other tools.

And javadecompiler, as noted by Salvador Valencia in the comments (Sept 2017), offers a SaaS where you upload the .class file to the cloud and it returns you the decompiled code.

Original answer: Oct. 2008

• The final release of JSR 176, defining the major features of J2SE 5.0 (Java SE 5), has been published on September 30, 2004.
• The lastest Java version supported by JAD, the famous Java decompiler written by Mr. Pavel Kouznetsov, is JDK 1.3.
• Most of the Java decompilers downloadable today from the Internet, such as “DJ Java Decompiler” or “Cavaj Java Decompiler”, are powered by JAD: they can not display Java 5 sources.

Java Decompiler (Yet another Fast Java decompiler) has:

• Explicit support for decompiling and analyzing Java 5+ “.class” files.
• A nice GUI:

It works with compilers from JDK 1.1.8 up to JDK 1.7.0, and others (Jikes, JRockit, etc.).

It features an online live demo version that is actually fully functional! You can just drop a jar file on the page and see the decompiled source code without installing anything.