I have compiled a list of free Photoshop brushes resources. The sites listed here all offer free Photoshop brushes, however it is wise to check the TOS of each site because some of them may not allow the use of the free brushes for commercial projects.
Just a couple of things first.
Most of the brushes at the sites listed below, are available for download compressed either as .zip or as .rar files. Extract the .abr files (photoshop brushes files) that are found inside the compressed archives at Program Files\Adobe\Adobe Photoshop X\Presets\Brushes. Replace X with your Photoshop version.
Many people, including me, download hundreds of Photoshop brushes sets. Installing all those brushes makes it difficult to navigate through them and find the brush you are looking for. In order to avoid this, you should organize your brushes. The way I do it is: I keep the brushes I use often in the Brushes folder while for the brushes I don’t use that often I have created new categorized folders (grunge, retro, flowers etc). So when I want to use for example a retro brush I load the brush sets from the Retro folder. If you have found a better way to do it please share with the rest of us.
Here is the list (The list is going to be updated regularly, so if you know of more places that offer free Photoshop brushes or if you offer brushes at your site leave a comment and I will add those sites to this list)