IconoMaker allows you to edit icons. It supports ICO, PNG, XPM, XBM and ICPR icon formats. Using this program you can create and edit icons in either standard or custom sizes, with color depths up to 32-bit True Color with 8-bit alpha channel. Paint tools include: color replacer, color selector, spray can, pencil, brush, flood fill, text tool, line tool, rectangle, curve and ellipse. For Windows XP icons, you get to use semi-transparency.

Launching IconoMaker opens a window with a interface similar to the Windows paint program. You can set IconoMaker to open to a new icon window or nothing. The new icon window shows a grid display with the grid matching the resolution of the icon you want to create. Along the left side are a set of drawing tools typical to most paint programs, including a color picker, eraser, pencil, air brush, paint brush and bucket (flood fill), text, rectangles, ellipses and lines. On the right side of the grid is a color chart (256) to choose from 256 colors. The grid overlay is tabbed, allowing you to open and work on more than one icon, either different sizes of the same icon, or completely different icons. Also shown on the right is a display of how your icon(s) appears actual size. With these tools, anyone can take advantage of the grid overlay and fill in the squares to create an icon that maximizes your artistic skills.

And it's free!