What makes a good domain name? Well, it's a subjective issue, of course, but here are ten tips to point you in the right direction.

1. Good domain names are easily memorable and easily typed. Generally this means keeping them short.
2. Hyphens should be avoided if possible. When I chose BetterWritingSkills as a domain name, I deliberately didn't include hyphens. I agree that it would have made it easier to read (Better-Writing-Skills.com), but the problem is that it is more difficult to *say*. If someone asked me for my web address and I said "better hyphen writing hyphen skills dot com" I certainly wouldn't expect them to remember it. The bottom line with hyphens is that most domains don't include them. So, when you tell someone your domain, they'll probably try typing it without any hyphens.
3. Use a plural form if this seems more natural. If you're selling toy trains, I'd go with "toytrains.com" instead of "toytrain.com".
4. Domain name search programs can help you to choose variations on a name. One such program is "Mozzle Std 2.30" which you can download for free from this address: http://www.simtel.net/pub/pd/54228.html  Programs like this are a great help when you're trying to think of a new domain name. (Mozzle's "Advanced Search" feature is particularly useful.)
5. If you're marketing your products and services primarily to users in a single country (other than the US) then seriously consider using that country's top-level domain. For example, if you're retailing products primarily to New Zealanders then choose to end your domain with ".nz". In Australia, use ".au" etc. This will help to identify your site as a local one. On the other hand, if you're marketing your products or services globally (or if you're in the US), use ".com" as your top-level domain. 
6. Don't use words that are tough to spell. Similarly, don't use words that are spelled differently in some countries. For example, "ColorChart.com" may confuse those of us in the Antipodes who would probably expect "ColourChart.com". 
7. Ensure that there will be no trademark or other legal problems with the domain name you choose. 
8. Brand names (e.g. BarnesAndNoble.com) may be preferable to generic names such as "books.com". For many years, it was assumed that generic names were hugely valuable. (Indeed during the late 90s, some generic domain names were selling for millions of dollars.) These days, many analysts argue that a domain name that features your brand name is more important. For example, if you've invested time and effort building up your brand name (Toyota, for example) you'd be better of using Toyota as your domain name, rather than something generic like "GreatCars". 
9. Avoid domain names that are too similar to existing ones. Not only do you want avoid legal issues (tip 7), but you want your brand to be distinct from that of your competitors. 
10. Remember, you don't *own* your domain name. You're merely renting it for a specified period. Don't let your domain name expire, or your competitors may snatch it out from under you.