This a guide for an Arduino version, but I am working on a mini ATtiny84 version. Once I get that working, I will post another Instructable on how to make it.
I'm sure you could make this same thermometer with an LM35 also, if that's what you have, and you probably won't have to modify the code.
This is an entry in both the LED contest with Elemental LED and the Hurricane Lasers contest, so if you like it, vote for it! Thanks!
Also, I am considering starting an electronics kit business to sell kits for the Instructables that I make, so if you like the idea, drop a comment or PM me!
Step 1: Parts list
1x Arduino Uno/Duemilanove/maybe Diecimila or equivalent
1x LM335 temperature sensor (I'm sure you could make it work with a LM35 too)
2x Single digit 7-segment display, common cathode (or a single 2 digit one)
1x 2.2k ohm resistor (not sure if you need this if you are using an LM35)
USB A-B cable