Over the weekend, I have been working on a chat client based on XMPP. It will work for all Jabber servers as well as GTalk.
How it all started
A friend of mine had requested me if I could support chat on his website. I was googling a bit. I am a big fan of Jabber since its open source and based on XMPP. I came across this page listing all Jabber clients: http://xmpp.org/software/clients.shtml, and I was trying out the web one.
I was awed by Claros Chat. Its a fabulous web-based chat client and has the look and feel of GTalk. I thought of taking advantage of its open source. So I downloaded the tar and was generally browsing through the contents when I came across smack. Now this is the core library which powers Claros. It provides a pure java implementation of the XMPP protocols. Its very well written. And it was not long before I started using it to write my own chat applet, based on Swings. People will find smack.jar and smackx.jar in its various versions in this maven repo under jivesoftware. A word of warning, the latest version 3.1.0 is still beta and did not work for me. I am using 3.0.4.
Demo time
Chat applet Login Screen
Click here to view the applet.
You would need JRE 1.6 to view this. Its still in very early stages of development and there are lots of bugs. But I guess the basic functions are in there, the UI sucks though. I will fix it as soon as I get some time, meanwhile, please bear up 
Sources
The sources can be found here. They are under the Apache License.