My favorite tool? My Black & Decker 36" Accu-Mark Gecko Grip Level.
Having a basic set of tools in your home is important for anyone who wants to be able to do a little "alter"-ing themself. It also makes you a damn grownup. If you're using a brick wrapped in a towel to hammer in a nail, it's time to put on your big-boy pants and buy a basic toolkit. A basic toolkit should include at least: a hammer, Phillips and flathead screwdrivers, level, tape measure, scissors, wire cutters, pliers, 3 kinds of nails, picture hangers, and anchors and screws.
But once you've got that covered, you're ready for the advanced class of my own "tool academy." As I mentioned above, I love my Black & Decker level. It goes way beyond your basic level. It's perfect for tasks like hanging multiple pictures. You can not only establish the level line for your frames, but measuring and marking where your nail holes should go are a literal snap: you slide the targets over to the correct distance, and they snap into place to allow you to mark your spots easily.
I'll revisit this topic every once in a while with more tool reviews and recommendations. After all, you don't want to let just any tool into your box. Just ask Elin Woods or Sandra Bullock.