A free tool that I recommend is edna groups http://www.groups.edna.edu.au/. The edna site offers educators the opportunity to design and host their courses on the Edna server. It is simple to use and has all the basic features found in Moodle.
Edna is a framework for your courses. It provides you with an opportunity to divide your courses into topics or units, create content, add content, develop simple quizzes and interactive activies as well as bein able to embed video and audio.
If you are new to e-learning I recommend you join edna groups and trial one of your lessons online.
Its free, its fun and easy to use.
If you would also like to include some free existing content then I suggest you also have a look at the Flexible Learning Framework’s Toolbox repository to search for existing content and resources http://toolboxes.flexiblelearning.net.au/
For those of you who want some hints on tips on free tools available keep any eye on this cool blog http://teacherchallenge.edublogs.org/2011/03/03/do-you-have-a-favorite-free-web-tool/comment-page-1/#comment-2289