Every 8-12 month I take a look at the going prices of hard drives as I'm looking to expand my family's storage capacity. To that end, I like to take a look at what drives are going for and make a little chart like this that shows the price one's paying per gigabyte of storage. Last time I looked the best deals were around 300GB (8-12 months ago), but they just keep improving quickly over time.
Right now the sweet spot is at 500GB or 750GB drives.
The Small Print I'm getting my data off of the lowest new drives from pricewatch.com. Given there are differences in speed (mostly 7400 RPM), cache, SATA/EIDE, interface speed, brand, etc, but I've tried to keep factors similar for the sake of comparison. These are also intended for storage, not high-performance, and files being stored on them are being copied for redundancy, so high reliability isn't a requirement.
Note: Prices above include shipping. Competition is fierce on pricewatch.com, so by the time you read this, they have probably already changed.
It is fascinating to watch Kryder's Law in action (similar to Moore's Law), which states "magnetic disk areal storage density doubles annually", as it applies to the price point dropping per-GB. So before buying just any drive, consider the 'bang for the buck'.