Compfight (online) - a flickr search tool
Creative Commons (online) - search for images you can reuse and remix
CGTextures (online) - great site to find background image inspiration
GIMP (open source) - advanced image editor
InkScape (open source) - free vector graphics editor
Paint.Net (PC) - awesome, free image editor
Pickle (Mac & PC) - pixel editor
Piskel (online) - sprite editor (export a PNG)
pixabay (online) - copyright free images
Seashore (Mac) - simple image editor
Sketchpad (online) - image creation tool
SumoPaint (online) - image creator with lots of cool effects
Audacity (PC & Mac) - sound recorder & editor
Bfx (online) - make sound effects for your game
EarSketch (online) - code your own music (intro instructions)
Free Music Archive (online) - interactive library of high-quality, legal audio downloads
Freesound (online) - collaborative database of audio snippets, samples, & recordings released under Creative Commons licenses
Incompetech (online) - royalty free sound effects & full music tracks
Jamendo (online) - creative commons music tracks
PartnersinRhyme (online) - free sound effects
Soundation (online) - generate 4 audio track sounds
WolframTones (online) - tool to generate interesting sounds