My fellow RockSugarBeet, Elise Murphy, asked her blog readers for advice on dialogue. I don't know if the following would work for everyone but it works for me so I thought I'd share:
When writing dialogue, be the character. Don't edit as you write dialogue (plenty of time for that later), rather meditate yourself into the character's soul and let him/her talk. Don't judge what he/she is saying or if it 'fits the character, rather let your character ramble until you nail their way of talking, reacting, thinking. Your characters will write the dialogue for you. A couple days later you can edit, refine, make sure it fits what and who your characters are. Three or four revisions later, your dialogue will be as natural as if your characters were sitting next to you.
How do you write dialogue?