Teamwork Project Manager is a Web based project management tool designed for freelancers and small teams doing client work.
Because it is a hosted service, you don't have to install anything on your own server. You can start using the service within 5 minutes (and without a credit card).
Best of all, there is a fully-featured, free-forever plan that lets you test drive the service. The free plan allows up to 2 active projects and 5 Mb of file storage. For some consultancies, two active projects is enough, and they may never have to upgrade to a paid plan.
Bottom Line: Teamwork PM is a great alternative to Basecamp. It has more features and a friendlier pricing structure (more pricing levels means you can slowly ramp up to the plan that fits your current needs).

It’s good to know of an alternative to Basecamp, because the free version isn’t hat helpful if you have more than one project to manage. Another very affordable web-based project management system is Project Insight. It’s good for even small teams because it’s so affordable as a monthly subscription (no shelling out big bucks for something that will load up your server and you may not even use for more than a few years) and it has features that put Microsoft Project to shame. You can see it at http://www.projectinsight.net.
We use DeskAway (www.deskaway.com) for our collab. needs – its simple, powerful and affordable. Customer service rocks!
It is not like it was a couple years ago, when Basecamp was the only project mannagement app around, as another alternative is http://www.comindwork.com, it has really lots of features and the pricing is reasonable. Another tool to take a look at is http://easyprojects.net, that has what to offer as well and if we do a little search in google we can see that there quite a few apps looking for their piece of the pie in this promosing market.