I use the Fuji disposable waterproof camera mentioned above. I think I paid $9.95 at Walmart and it has something like 18 shots on it. The downside is that it's film, not digital, so there's no review of your pics to know how well they are framed, etc. I just get around this by taking lots of pics of anything interesting and hope at least one is a good one.
I decided to go this route because, after reading many many reviews, I've determined that none of the "waterproof" cameras are truly waterproof (especially in saltwater. You can find sites online that explain how the waterproofing components of cameras are worn away over time, especially by saltwater) - they're more "splashproof." And I wanted something I could really take underwater pictures with for an extended period. For the price of one of the waterproof digital ones that might leak on first or second use, I'd just rather by the disposable ones. I'm sure others have had great luck with them, but my luck runs more along the lines of it leaking first use.
Also, when I get the disposables developed, I always select the option to get the pics on CD so I have them in digital format to put on my computer.
A few pics from a Fuji disposable underwater camera: