Cash-strapped teachers rejoice! Technology website CNET has a gallery of the best Windows software for a hard-hit economy, offering up free alternatives to common software.
I can vouch for OpenOffice.org being an excellent, easy to use replacement for Microsoft Office. I've also written before about using free antivirus and firewall software like the ones recommended in the article to help keep your school computer running smoothly (see Fix Your School Computer and Prevent Problems for FREE ).
There are tons of practical applications of these programs for your home and school computer, and will save you a lot of money in these trying times. If you can recommend any other free software that would be useful for educators, please share it in the comments. Thank you!
UPDATE 7/24/09: Check out AlternativeTo for a full catalog of quality options.
UPDATE 1/8/10: Lifehacker explains how to Use Google Suggest to Find Software Alternatives.