From M.U.G.E.N Wiki
Tools created by the community. For the community
The most popular tool of today. The current release is Fighter Factory Ultimate available here 
There is also another version of Fighter Factory known as Fighter Factory Classic which many people prefer to work with.
A 5 years commemorative version was released by VirtualTek Systems which can be downloaded at their website  It is basically Fighter Factory Classic with some bugs fixed.
Mugen Character Maker
One of the first windows GUI SFF editing tools. Still a good program but somewhat superceded by FF and MEE. Available at Random Select. The official page has been decommissioned. 
Mugen Editing Ensemble
A very good tool made with Visual Basic by Ragnarok. This is very stable but not as user friendly as FF. It does force you to do a number of things properly. Available at Random Select. 
There are a number of other tools out there, many linked on the afore mentioned Random Select. All these may help you out or assist in your progress with MUGEN. Try things out and see what suits.
A New Opensource Mugen Editor
A new tool made by Nobun, developed in c++ (Qt libraries). It is under development and it is user-friendly. It allows you to edit and save all type of Sff (including the new Sff 2.0). It is for Linux and Windows (and hopefully for Mac Os X if a Mac Os X packager will be found).
A Mac Os X packager is requested in order to let Nomen to be available also for Mac. If you are a Mac user and you want to contribute, Read this page and contact Nobun as explained (you will receive a reply with all details about what to do):
- Nomen Official Forum: Mugen Rebirth (see section "Nomen").
- Nomen Download Page: http://nomeneditor.sourceforge.net