http://www.eecs.wsu.edu/paint.net/
http://www.eecs.wsu.edu/paint.net/redirect/mirror_25_coral.html

Paint.NET
Paint.NET is a free image and photo manipulation software for Windows 2000, XP, Vista, or Server 2003. Paint.NET started development at Washington State University with additional help from Microsoft, and continues to be updated and maintained by some of the alumni that originally worked on it. Paint.NET features layers, painting and drawing tools, special effects, unlimited undo history, and levels adjustments. Paint.NET is completely free, and the source code is also available for free.
Simple, intuitive user interface
Every feature and user interface element was designed to be immediately intuitive and quickly learnable without assistance. It is also designed to be immediately familiar to users of the original MS Paint software that comes with Windows. 
Layers
Usually only found on expensive or complicated professional software, layers form the basis for a rich image composition experience. You may think of them as a stack of transparency slides that, when viewed together at the same time, form one image. 
Powerful Tools
Paint.NET includes simple tools for drawing shapes, including an easy-to-user curve tool for drawing simple splines or Bezier curves. The facilities for creating and working with selections is powerful, yet still simple enough to be picked up quickly. Other powerful tools include the Magic Wand for selecting regions of similar color, and the Clone Stamp for copying or erasing portions of an image. There is also a simple text editor, a tool for zooming, and a Recolor tool.