From some time now, there is a solution to watch free movies online on www.hulu.com.
And it is legal!
What you can watch there:
- TV series (Family Guy, Arrested Development, Lost, Desperate Housewives, etc.)
- TV shows (Saturday Night Live, The Daily Show with Jon Stewart, The Tonight Show with Conan O'Brien. etc.)
- movies, from classical ones like Taxi Driver and Spartacus, to easy teenage comedies
On the downside, the number of movies available is limited (compared to what you can find on torrents), but the offering is increasing regularly.
Also, there are several 30 seconds commercial breaks during the movies, but it's a whole lot better than the 5 minutes ones from TV.
Oh, and you need an USA IP to watch the movies, as the copyright for the movies is valid only across the US. There are many solutions to obtain a free US IP. One of them is easily available at http://www.anchorfree.com/
All you need now is just some microwave popcorn and you are ready for a movie marathon...