3D modeling, gaming and animations:
Blender
http://www.blender.org/
http://www.blender3d.org/

OpenFX
http://public.www.planetmirror.com/pub/openfx/1.0/

Wings3D
http://www.wings3d.com/

Anim8or
http://anim8or.com/main/index.html

2D Animation w/ Text to Audio Generator:
Tales Animator
http://dollysoft.com

UV Mapping:
UVMapper Classic
http://uvmapper.com/uvmapper.htm

Not Software, But Free, Fine Photos +!:
Font Play
http://www.fontplay.com/freephotos/

Video Recording/Editing:
VirtualDub
http://virtualdub.org/

TMPGEnc
http://www.tmpgenc.net/e_main.html

VirtualVCR
http://www.digtv.ws/

Zwei-Stein
http://www.thugsatbay.com/

Beautiful Terrain generator:
Terragen
http://www.planetside.co.uk/terragen/

Nice Water Ripples effect Plug-in:
Water Ripples
http://www.redfieldplugins.com/filterWaterRipples.htm

Powerful Image creation and editing:
GIMP
http://gimp.org/

GIMP but with vector graphics, win32 port isn't
wonderful, but it is useable as long as you're on
an NT based system (GPL'd):
Sodipodi
http://sodipodi.sourceforge.net/

Desktop graphics editor for wallpaper, icons, cursors:
PixelToolbox
http://www.axiomx.com/PixelToolbox/index.htm

Convert bitmapped images to text art, even full color HTML:
Pic Texter
http://www.axiomx.com/pictexter.htm

Powerful paint application, supporting
Layers, Transparencies & Masks:
Pixia
http://www.ab.wakwak.com/~knight/index.html
(be sure to check out the user made filters in the Download section)

All-in-one Image viewer/editor with batch processing:
Irfanview
http://irfanview.com

Insert Copyright info on images, even in batch mode:
CopyRightLeft
http://www.lunerouge.org/gnu/crl_e.htm

Quickly view EXIF data:
ExifRead
http://www.geocities.com/alonn_01/ExifRead/ExifRead.htm

Get Rid of Dust from Photographs:
DustBuster
http://www.dustbuster.net/

Get your photos/images organized:
FotoAlbum
http://www.fototime.com/pages/ftdownloads

Create slide shows with still images as .AVI files, even sync sound:
Slide Show Movie Maker
http://www.joern-thiemann.de/tools/ssmm/

Powerful usenet news reader/poster client:
Xnews
http://xnews.newsguy.com/

Cool Drumming Sounds:
Stomper:
http://www.master-zap.com/stomper/

Mozilla based small fast browser, very nice indeed,
although Mozilla has got better pop-up blocking etc. (GPL'd):
Firebird
http://www.mozilla.org/projects/firebird/release-notes.html

Very advanced yet tiny Notepad clone, find and
replace all type stuff implemented:
Metapad
http://www.liquidninja.com/metapad/

MP3 player Formerly known as FreeAMP (GPL'd):
ZINF
http://www.zinf.org/

File compression/decompression utility:
FreeZip
http://freezip.cjb.net/

Winzip Clone(GPL'd):
J-Zip
http://www.bytamin-c.com/Source/

Archiver with native format giving just about the best compression
possible and able to create self extractors, also handles numerous
other formats including Bzip2(GPL'd):
7z
http://www.7-zip.org/