V-Tech Touch & Discover Alphabet Town
CJ has loved playing with this ever since we got it for her. (She even takes it to bed sometimes.) We first noticed that she understood letters when the game would ask "Press the letter W...Press the Letter H..." and she got most of them correct!
I bought both the uppercase and lowercase letters at Lakeshore Learning but you can find them at Wal-mart or Target. When playing with our magnet board, CJ would put the letters up as I told her what letter it was and what sound it made. This was pretty informal and I didn't think she was really paying attention. I guess I was wrong.
Meet the Letters
Although adults may find the "Meet the..." series to be dull and repetitive, CJ is always glued to the TV when it's on. The DVD shows both upper and lowercase letters but doesn't include the phonetic sound they make. We first borrowed the DVD from the library and bought it once we realized how much she liked it. We also bought the complete collection (Meet the Shapes, Meet the Colors, Meet the Numbers, Meet the Sight Words 1, 2 and 3).
A great website for teaching the alphabet and early reading skills is starfall.com. Click on a letter to hear its name, the sound it makes and different words that start with that letter.