Wandigo

Wandigo is a free multi-monitor wallpaper tool for Windows. With Wandigo, you can set a separate wallpaper for each monitor easily.

Features: Add folders and images for a monitor; Manage each monitor separately; Resizing options for wallpaper images; Set background color; Shuffle the images or set in order. Wandigo is intended for users with a multi-monitor setup. However you may want to use it for its slideshow feature on Windows XP even if you have a single monitor.

Requirements:

Microsoft .Net Framework 3.5