Have a look at the reStructuredText (also known as “reST”) format, which is a plaintext/docstring markup format, and probably the most popular in the Python world. And you should certainly look at Sphinx, a tool to generate documentation from reStructuredText (used for eg. the Python documentation itself). Sphinx includes the possibility to extract documentation from the docstrings in your code (see sphinx.ext.autodoc), and recognizes reST field lists following certain conventions. This has probably become (or is becoming) the most popular way to do it.
Your example could look as follows:
"""Replace template placeholder with values.
:param timestamp: formatted date to display
:param priority: priority number
:param priority_name: priority name
:param message: message to display
:returns: formatted string
"""
Or extended with type information:
"""Replace template placeholder with values.
:param timestamp: formatted date to display
:type timestamp: str or unicode
:param priority: priority number
:type priority: str or unicode
:param priority_name: priority name
:type priority_name: str or unicode
:param message: message to display
:type message: str or unicode
:returns: formatted string
:rtype: str or unicode
"""