This YouTube movie demonstrates the Dasher interface, developed at the University of Cambridge in the UK. Dasher works by pointing to a letter in a vertical list. The subsequent letters, weighted in order of probability, unfurl and you can keep pointing to make words and sentences. Try Dasher in Java here.
It's flashy and interactive, and even elegant somehow. It's very quick with English dictionary words, but slow on proper nouns like names and places. I can imagine Dasher having great potential for disabled users, as well as for simple touchscreen interfaces.
Even cooler, what about a similar interface for choosing complementary colors or configuring a set of related product options?
(Link via GUUUI)