TLC5940 is really good and probably easiest way, however they are very expensive. I personally like to use 74hc595 chips and multiplexing, they are cheaper and you can control allot of leds, In one project I control six 8x8 red/green led matrixs at 4bit color depth whit only one atmega168 and 13 595 chips, that's a total of 768 leds. However there will not be much cpu time left for other processing.
/Jon