WP-Cache 2
I recommend this as a first (and possibly only), easy to install step to significantly speed up your site
WP Super Cache
Unlike WP-Cache 2, WP Super Cache does not use any PHP processing and serves static pages with URL rewrite rules on web server level. In a traditional Apache setup this does not help with memory usage but due to not using PHP more pages can be served on the same hardware.
Differences between WP-Cache 2 and WP Super Cache:
Requirements:
- WP Super Cache requires that you have Permalinks ON
- WP-Cache 2 works with both Permalinks ON and OFF
- WP Super Cache may require manual edits
- WP Cache 2 usually installs automatically without manual intervention
- WP-Cache 2 makes your site very fast, and can handle a ton of pageviews
- WP Super Cache makes your site very fast, and can handle even more pageviews
The above mentioned plugins don't solve another issue of typical Web 2.0 sites, including WordPress Blogs, though: A theme might have a dozen extra CSS and JS files all by itself, and every plugin might add another 1-5 so you'll end up with 20, 30 or even more extra files that need to be loaded before your site is ready.
PHP Speedy
PHP Speedy consolidates those many files into ONE CSS file and ONE Javascript file. The speed improvement may be even more drastic than with the Caching plugins. Using both a caching plugin and this "extra file consolidation plugin" should make your site load almost instantly.