Project Gutenberg has over 49,000 free e-books - you can download them as Kindle e-books, EPUB files, or read them online in your browser. If you don't have a particular book or author in mind, it can be fun to browse the categories and subcategories on their Bookshelf page.
LibriVox is great if you prefer audiobooks. Everything on the site is read by volunteers, so the performance quality varies, but some works have multiple versions available, so you can choose which readers you prefer. You can download a whole book as a zip file, stream individual tracks, or subscribe in iTunes.
Some of my favorites from these sites include Jill the Reckless by P.G. Wodehouse (LibriVox) and The Extraordinary Adventures of Arsene Lupin, Gentleman-Burglar by Maurice Leblanc (Project Gutenberg). Feel free to recommend your favorites in the comments!