Vocre is a free iPhone app that TechCrunch describes like this:

It’s almost magical how Vocre works; Speak into the app while your iPhone is vertical, flip the phone horizontal and the phone’s accelerometer cues the app to translate and speak what you’ve said into the language of the people you’re speaking with, they then can respond, rinse, repeat.

That description actually came from a post that’s a few months old — TechCrunch just posted an update about improvements Vocre has made since then, and which they just announced today (along with just making it free).

I’m adding it to The Best Sites For Beginning iPhone Users Like Me.