The following site is great for beginning readers.  It is an interactive site that allows kids to read Clifford books, play games, and take quizzes about what they've read.
www.teacher.scholastic.com/clifford1

Starfall is an excellent interactive online activity for emerging readers.  It can be used in the classroom or at home as extra support with letter and word practice. It can also be used as a tool to practice fluency, and answer reading comprehension questions. 
www.starfall.com

Great for phonics activities! You can double-click on any of the letters in this web site and have your students match the pictures with the sounds.
http://www.kiddonet.com/gb/flash/phonics/Intro.html

High frequency word practice is critical to a child's fluency.  This web site allows your child to place appropriate high-frequency words into sentences.
http://www.sadlier-oxford.com/phonics/grade_k_1/hifreq.htm

Earobics has leveled literacy games with various activites from alphabatizing words, to identifying antonyms.  There are activities for beginners and advanced young readers.
http://www.earobics.com/gamegoo/gooey.html

Spelling City is a great tool to practice spelling words!
www.spellingcity.com