Here are some of the most popular and widely-used Ruby projects, as ranked by activity on RubyForge.

ProjectDescription
RailsFull-stack MVC web application framework.
RubyGemsThe Ruby standard for publishing and managing third-party libraries.
RMagickInterface to the ImageMagick and GraphicsMagick image processing libraries.
SQLite-RubyA Ruby interface for the SQLite database engine.
MongrelA small, fast HTTP server for Ruby and JRuby.
FreeRIDEA pure Ruby Integrated Development Environment.
Active SupportUtility classes and extensions to the standard library.
Action PackWeb-request routing, handling, and response framework.
RSpecBehaviour Driven Development framework for Ruby.
ruby-oci8Ruby interface for Oracle using OCI8 API.
TypoA lean weblogging engine powered by Rails.
Win32 UtilsRuby interfaces to various Windows systems and services.
Ruby/DBIDatabase-independent interface for accessing databases.
Action MailerFramework for designing email-service layers.
Instant RailsOne-stop Rails runtime solution with Ruby, Rails, Apache, and MySQL.