I've posted before about creating an avatar for your online personality. Here are some new sites to investigate:
BeFunky, you upload a picture of yourself, choose a photo effect to "enhance" the picture, and then choose other additions for your picture. Easy to use, no registration required. When you are done, click save, and your picture will be saved to your computer.
WeeWorld, you can create a WeeMee. In order to save your person with a background, you must register on the site, but you can use a screen shot to save without registering.
Part of the marketing campaign for the movie Avatar is an Avatar avatar generator.
Here's a small version of my angry Avatar poster. you can use it to create your own Avatar avatar. Move your mouse over the poster, and click on "Create my avatar".
Thanks to Graham Stanley for these tips!