With DoppelMe you can create a cool graphical likeness of yourself, your friends, family or any group of people for use as an avatar in forums, instant messenger, blogs and almost anywhere else on the web. 

It's free and there are no Flash, ActiveX controls, downloads or toolbars needed - just your browser and a few mouse clicks. That's it! 
The Hero Factory
Make your own hero!
Blabberize
Take a look at the quick start guide to get started with Blabberize
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Voki

Take a look at the learn by doing project to see how you can use this tool.
Build Your Wild Self