Gamasutra has good general info on all aspects game development; if you create a profile you can sign up for their newsletters, which are a good way to keep a finger on the pulse of the industry

Unity 3D is a popular and full-featured game engine; use C# or a dialect of javascript to write 3D games with physics, animation, and effects. There is a free and nearly full-featured version of the system. Documentation and community support are both excellent. Unity is a favourite of mine.

UDK is a level editing and scripting system built on top of the Unreal Engine. High end graphics and lots of other cool stuff. I don't have personal experience with this one. Free to use, but I believe you will pay a royalty if you ship a game for money.

CryEngine is possibly the ultimate game engine, certainly the best-looking PC graphics (and highest licensing fees for commercial use!) There is a free version available from crydev.net. I haven't used it.

GameMaker is a popular game creation and prototyping toolset that can be used by non-programmers, though there is also a scripting interface. I haven't used GameMaker, but I've been impressed by what people can do with it.

HTML5 lets you use javascript and web GL to build cool graphics demos and games. I've only scratched the surface of what's possible, but there are lots of demos out there with source code you can look at, such as:
http://html5demos.com
http://www.chromeexperiments.com

For art creation, the most popular industry tools are Autodesk 3D Studio Max and Maya for modelling and animation, and Adobe Photoshop for creating textures. These are all available in student or free trial versions. Alternatively Blender and Gimp are open source modeling and texture creation tools.