There are a number of tools, described here in ascending order of cost:

The .NET Framework SDK is free and includes command-line compilers for C++, C#, and VB.NET and various other utilities to aid development.
SharpDevelop is a free IDE for C# and VB.NET.
Microsoft Visual Studio Express editions are cut-down versions of Visual Studio, for hobbyist or novice developers.There are different versions for C#, VB, web development etc. Originally the plan was to charge $49, but MS has decided to offer them as free downloads instead, at least until November 2006.
Microsoft Visual Studio Standard 2005 is around $300, or $200 for the upgrade.
Microsoft VIsual Studio Professional 2005 is around $800, or $550 for the upgrade.
At the top end of the price range are the Microsoft Visual Studio Team Edition for Software Developers 2005 with MSDN Premium and Team Suite editions.
You can see the differences between the various Visual Studio versions here.