Towny is the oldest, still-developed plugin for Minecraft servers. Towny provides players the ability to protect their land in Minecraft, allowing server admins the time to do other things. It has a great API and is actively developed.
Towny is a plugin for a Bukkit modded Minecraft server. The plugin itself is a manager for a Resident-Town-Nation hierarchy, as well as a block permission manager for a grid-like protection system. Each town has a mayor, while a nation has a king. They both have their own assistants to help run their respective people. Players can also purchase land from the town, as well as an optional daily tax set by the mayor. The player can allow his friends from out of town to build on his land when even his very own town's people can't build if he so wishes.
The basis of protection follows under how the world is separated into chunks. For those unaware, minecraft servers are broken up into 16x16x384 sections of blocks. The 384 being the height from the bedrock floor to the clouds in the sky. The protection ignores the height and focuses on the x and z planes. The default size for grid squares is 16x16, similar to the chunk size (configurable when you start using towny). So claiming a townblock (a grid square) allows that section of land to follow your town's or the plot owner's permissions.
Each town can claim up to a certain amount of townblocks, a set ratio or amount configured in the setting that is relative to the amount of players taking residence in that town. Residents themselves have no limit on how many they claim, however the daily tax (when using alongside an economy plugin) will take a bite out of their resources. The money is tunnelled to the town's bank account that only the mayor can withdraw from, except if the town belongs to a nation. Any town belonging to a nation may be required to pay the nation a daily upkeep as well.
The gods of the land (admins) have the ability to start and end wartime mode. During war, most commands are frozen in order to focus on the event. Whilst at war, block permissions are ignored and any town that is in a nation is completely unprotected to the other nations residents. Also, each cell, or townblock, is given a certain amount of health. When a non-allied player enters the townblock, the townblock's health decreases. The town's residents have to force the player's out while still attacking others. When the health reaches zero, the town loses claim over that townblock. The focus is to defeat the each town's home block where the town's people spawn from.
One of Towny's strongest points is the ability for a server admin to configure Towny to their liking and then let the players make their decisions from there. There's no selection-wands, no players claiming odd-shaped regions to troll other players. Players can go it alone or they can ally into complex groupings. Players can do their own claiming, customize their protections in-game, kill, spawn, teleport, etc. all according to how the server admin has configured Towny.
Towny includes a wide variety of features to offer instant enhancements to your traditional Minecraft server.