This script overrides the bash cd command so that it saves the previous directory to a directory history. ALT-Left then moves back to previous directories in the history, and ALT-Right moves forward. ALT-Up changes to the parent directory. Finally, ALT-Down displays the history.
It also adds a cde command which copies all future directories to the history and then changes to the directory, in order to preserve all history.
Copy .dirhistory.bash to your home directory and source it from your .bashrc.