This article outlines a few free tools that you can use to transform regular pictures into pencil sketches.
“4 Ways To Create A Free Pencil Sketch of Your Photos” by Technix Update is a guide to giving your own pictures a little bit of artistic flare. With these four free tools, you can turn any picture into a black & white pencil sketch for free:
I converted the picture you see here with Sketch My Photo. The site is an online tool that gives you a watermarked thumbnail for free, and charges about $5 for the full-size sketch.
FotoSketcher is a freeware desktop application for Windows with a variety of effects such as pen, ink and paint.
The most impressive tool of the bunch is BeFunky. It is a finely polished web-based application with many different artistic effects. It also supports basic online editing such as cropping and straightening. BeFunky lets you download the finished product — the file comes watermarked, but the watermark is in a white frame outside the edges of your picture.