Alice: www.alice.org - A 3D environment with graphical tools that allow young students to create games, stories, or other scenarios.

Stencyl: www.stencyl.com - My favourite (at the moment)! Allows Flash games to be developed using a visual, drag and drop interface. Programming directly in ActionScript is available for advanced work as well. These games are publishable on the web and a number of mobile devices as well. Also consists of a community driven collection of game assets (pictures, backgrounds, sounds, characters, enemies, and objects) that can be shared and used, or even sold and purchased.

Scratch: scratch.mit.edu - A project of MIT, Scratch is aimed at very young children, and the samples posted on the site created by students show very little depth or professionalism, but at least it got them interested in computers.

Sploder: www.sploder.com - I very recently came across Sploder. There seems to be no programming at all, simply dragging assets. The samples that are provided are quite interesting, but the games that the users create come no where near the level found with Stencyl.