yes, Ubuntu and many of it's flavors have feature called "ad-hoc network"
and "wifi tethering"

To make wifie hotspot, you need to have some connection (cable connection, or another wifi connection (that woudl require a second wifi adapter).

Remember, you can't use the same adapter as WiFi receiver and wifi spot.

Go to network settings -> Edit Connections -> Wireless -> Add.
Create a new connection and select Ad-hoc in Mode you can specify a password and enjoy.