GIMP

GIMP (GNU Image Manipulation Program) is a free, open-source image editor, similar to Adobe Photoshop. It's not quite as user-friendly as Photoshop, but if you're familiar with Phoroshop, you can find your way around in GIMP. Concepts such as selecting tools from a Toolbox palette (shown below) and building an image with a Layers palette transfer easily from Photoshop to GIMP.

Plus, it's free, and does some things better than Photoshop.

Because it's open source, there are plenty of free plug-ins and extensions available to help you customize GIMP to best suit your needs.

And, to help you out with the sometimes steep learning curve of both Photoshop and GIMP, there are archived tutorials available at:
http://www.coopext.colostate.edu/comptrain/copho.shtml

More information about GIMP, and the download it self, can be found at http://www.gimp.org/