Q: "How do I make Entity Relationship Diagrams (ERDs) for my Salesforce org?"

A: The two free tools I've used are Schema Spy, which Jeff Douglas wrote a terrific installation walkthrough for, and a new one I just learned about, ERD Tool. ERD Tool appears quite easy to use (and it runs in Salesforce!), though I haven't really taxed it yet.

Remember too that diagrams of Salesforce's standard objects are always available, no installation required.

Schema Spy output:

ERD Tool output (in the UI, click the plus signs to show lists of fields):