I put pen/pencil to paper and draw and annotate my design in my note/sketchpad. After I've come up with a basic concept I hit ole' Photoshop to create a full scale mock up although I NEVER EVER SLICE. I then move to hand crafted code and create a couple of basic concepts from my PS mockup. After I've come up with a fully coded demo, I finish it off with all the pretty pixels, browser test, validate code and make it live.