Coventi.com - A site offering several different packages, with the cheapest being free for the personal user.
Google Docs - Part of the Google suite of products, which enables you to invite others to work with you on a document.
Glypho.com - Put down the basic idea of your story, get a plot and character suggestions.
Novlet.com - Collaborative writing where you write just a couple of paragraphs at a time.
Portrayl.com - A site that lets you write one chapter at a time, and when done, release it as a PDF. You can also allow others to write a chapter if you want.
SynchroEdit.com - A browser-based editor that allows multiple users to edit the same document at the same. Will indicate who's doing with with colors.
WideWORD.net - Create a secure document online and then pick who can look at it and participate.
Writeboard.com - A collaborative writing system by the folks at 37 Signals.
Writewith.com - Upload your documents and work with others on it together online.
Zoho Writer - A free online word processor from Zoho.
Dictionaries & Thesauruses
Alternative Dictionaries - Sometimes we all need to bend the rules some, and this site gives you definitions of various slang words.
Cambridge Dictionaries - Multiple dictionaries and references from Cambridge press.
Dictionary.com - Based on the Roget's Dictionary. Also gives you quick access to thesaurus.com.
Dictionary.hm - An AJAX powered dictionary that pops up the definitions as you type.
Merriam-Webster.com - The online version of the well known print dictionary.
The American Heritage Dictionary - Over 90,000 words, a full print version of a dictionary put online.
UrbanDictionary.com - Multiple slang definitions of just about every word you may encounter in every day conversation.
Word.sc - A user-edited dictionary that lets you vote on definitions and upload photos of the word.
YourDictionary.com - Gives you the definition and suggest idioms.
Grammar & Tips
Bartleby.com - A collection of books in the public domain, broken down by category. Has a large election of books on language usage.
EnglishForums.com - Stumped by a tricky grammar moment? Join these forums to get advice from others who love the language.
Guide to Grammar & Writing - Gives tips on grammar from the word level up to essay paper length.
WordNet - Simple in appearance, WordNet is a huge lexicon of the language.
World Wide Words - Articles on word usage Lexicographer, turns of phrase, weird words, and more.
Plotting & Writing Tips
BlockbusterPlots.com - Get numerous free tips on how to construct a sensible plot for any story.
Character Questionnaires - Every good author will tell you that you need to know your characters before you write. This will help you interview them.
Freytag's Pyramid - From ReadWriteThink, it explains the concept of â€œFreytag's Pyramidâ€ which is the basis of how any plot should be structured.
The â€œBasicâ€ Plots in Literature - Describes the theories behind all of the known basic plots, and the schools of thought for each list.
Tips for plotting for every type of character - A lengthy list of stupid archetype characteristics for just about every type of character.
ajaxWrite - An AJAX based online word processor that runs in Firefox. Looks like Microsoft Word so you have a familiar interface.
Nevercode Docs - A downloadable word processor that allows you to store your documents online so they are accessible anywhere.
ThinkFree.com - Looks almost exactly like Microsoft Office and offers 1GB of free online storage. (via)