Adobe Photoshop

The most widely used graphics application, you can achieve just
about any look you desire with Photoshop. A bit pricey for most
new webmasters, nonetheless, this is the king of graphics!!

Animation Online

Make animated banners and buttons online for free.

Flaming Text

You can make banners, buttons, and bullets online for free.

Free Online Image Compression

Free compression of JPGs and GIFs.

Free Stuff

Ulead's free stuff includes animations, fonts, and images. Some
good stuff to enhance your websites.

Image Compression

A very good tutorial on image compression.. but very detailed!!!
Not a quick read, but definitely has all the facts.

Paint Shop Pro

If you don't have the big bucks to fork over for Photoshop, then
don't fret, Paint Shop Pro could be your answer! PSP has loads of
great features that will have you creating some very sleek
graphics. It includes an animation application as well. All this
for $99. If you decide to use this application, I would recommend
this site

Robin's Paint Shop Pro Resources.

Thumbs Plus

This application will create thumbnail images and even build the
web pages for you.