it depends on where you are in the dev process. If you find yourself in the early stages, paper prototyping is very powerful, easy and dirt cheap. By keeping it as simple as possible, you don't get so emotionally invested in your designs and you signal to your users that major changes are perfectly ok (with hi-fi prototyping users often make fewer and smaller change requests). There's a method to it but it's as lightweight as you'd imagine. Carolyn Snyder has written THE book on paper prototyping http://www.paperprototyping.com/

I mostly use Balsamiq Mockups. It's a lo-fi prototyping tool (software based) but it makes prototyping much faster. Prototypes, or mockups as they are called, are actually rendered as hand drawn sketches so you don't bother with pixel perfection. It's actually quite fun to use and becomes somewhat addictive. One drawback is that prototyping GUI changes and interactivity is difficult. http://balsamiq.com/products/mockups

I've also used Pencil, a prototyping plugin for firefox. It's not as polished as the other Balsamiq Mockups but it's free and covers the basics. http://pencil.evolus.vn/en-US/Home.aspx