I found this clever alternative to the GoogleAdsense program; Vibrant Media has a program called IntelliTxt, that scans a webpage much like Adsense to generate relevant ads, but embeds the ads as links within the content, rather than as an ad box.
When one of the ad links is hovered over, a tooltip box appears saying that it's a sponsored link, similar to the technique used at a9.com to view more information about a site.
The downside is it's a lot more limited than Adsense, that allows sites of any size to participate; publishers with Vibrant Media must have more than 1 million page impressions per month, and their content must be in a certain category, like Automotive or Computing & Information Technology to be accepted.
It's a tool more for sites that already have a lot of traffic than small sites at the moment, but the idea could work well on any page about a specific subject.

For more info:
Too Close For Comfort? - An interview with the creator of IntelliTxt, about the controversy of blurring the boundary between editorial and advertising.