Favicons are those little 16 x 16 icons that appear next to the URL in the address bar of a web browser. They also show up on the tabs (if you’re using a tabbed browser), in your bookmarks. There is Photoshop plugin to create *.ico file, but I would really suggest You to use Online favicon generators to automate the process. I will provide you a list of website where you can generate free of cost your Favicon and you must visit “How to Add favicon into WordPress Blog and Website“.
Today I am compiling a list of inspirational Favicons, a list of Primer icons and website where you can create tiny gem for your own website. Click on particular favicon to get more insight into that website and than you can compare how favicon design relates to overall layout design.
Inspirational favicons :
Favicon Generator Tools
Chami Favicon Generator
Mysteries Of The Favicon.ico — How To Create A Favicon In Photoshop
Dynamic Drive: FavIcon Generator (beta)