Blogger.com is owned by Google and is probably the most popular free blogging services on the web. You can edit the template and this offers almost unlimited options for customization.This customization or "hacking" just got easier with the launch of BloggerHacks Wiki which "catalogs dozens of "hacks" for Blogger in categories ranging from Navigation to Encryption. The hacks vary in difficulty from easy to advanced, and there's also an area for requesting new hacks." (link via DownloadSquad.com).
Blogger.com a new beta version last week which does not allow you to edit the template yet (it will be fixed later) but if you already have an old blog, you may find BloggerHacks Wiki very useful.
References:
Blogspot URLs That You Should Bookmark. Digital Inspiration.
Image source: Blogger.com.