Unsurprisingly, I would recommend Google Docs as an alternative. It's nowhere near as powerful as Word is, but their aim is to offer the 10% of the application that 90% of the population needs. Actually, to be fair that's only where they're starting, but it's a good start.

Other than that, there are tons of free word processors. Abiword is another that I don't think has been mentioned here.

I used to use OpenOffice, but now prefer LibreOffice.

Actually, I have OpenOffice, LibreOffice, Microsoft Office 2010, and Abiword all installed on the computer I'm using right now. But I use Google Docs because it does everything I need it to do, and is far more convenient.