Netflix has been developing into a really nice streaming solution over the last couple of years. It is not free per se, but after a measly 8 bucks/month you get access to literally tens of thousands of free movies and tv shows.
None of the freshest movies are there to begin with, but it is awesome for catching up with those 1-2 year old gems you might have wanted to see but somehow didn't get to. It also comes with a nice recommendation engine, picking streams that you might like to watch next based on your viewing history and movie ratings.
Stream at netflix.com
And don't forget their 2 weeks free trial!