'Pretty' code listings are sometimes considered worthwhile by the "ordinary" programmer, but they have a serious place in the typesetting of dissertations by computer science and other students who are expected to write programs. Simple verbatim listings of programs are commonly useful, as well.
Verbatim listings are dealt with elsewhere, as is the problem of typesetting algorithm specifications.
The listings package is widely regarded as the best bet for formatted output (it is capable of parsing program source, within the package itself), but there are several well-established packages that rely on a pre-compiler of some sort.
Highlight is attractive if you need more than one output format for your program: as well as (La)TeX output, highlight will produce (X)HTML, RTF and XSL-FO representations of your program listing. Documentation is available on the highlight project site.
The lgrind system is another well-established pre-compiler, with all the facilities one might need and a wide repertoire of languages.
The tiny_c2l system is more recent: users are encouraged to generate their own driver files for languages it doesn't already deal with.
The C++2LaTeX system comes with strong recommendations for use with C and C++.
This question on the Web: http://www.tex.ac.uk/cgi-bin/texfaq2html?label=codelist