I bought a NAS enclosure from D-Link and put a drive in it, and attached it by ethernet cable to the router. Make sure you get one that powers down itself (the D-Link said it did, but didn't until they did a firmware upgrade) then you can just leave it connected all the time.
They are a lot slower than USB attached drives though - no problem in normal use, but if you're doing huge backups then that might be an issue.
Also, these things do have uncertain reliabilty - I lost a Western Digital one after we had a power-cut and the file system was wierd and it couldn't be easily recovered. Therefore don't be tempted to see all that lovely space and move your entire photo collection etc onto it. Use it for backup only so you've got copies of everything in at least 2 places. They also make transferring files between machines very easy.