Below is a short list of some really great tools for editing or creating graphics, editing photos, etc.
The Gimp - It is the cross platform FREE and Open Source alternative to Photoshop.
Paint.NET - This is my long time favorite because it is easier to install and use than Gimp, opens faster, and has most the features I need.
Pixlr - Has most of the important functionality of The Gimp, but runs in any browser that supports flash.
Please suggest any other graphics apps that should be included here.