Hi,
I am looking for FREE "craigslist" software.
I would like to start a
FREE classified ads website for my local area.
Please contact me if you can help me,
Thanks !!!

well.. i just found yesterday such script, when someone submitted a site to my directory.
It's not Free, but is low as 3$ can be. Of course, I don't know if it's as "craiglist" complexity, that may be a custom script.
Check it here, and see if this script is suitable for you:
http://www.resellerphp.com/phpreseller/products/1007.html
They have a demo site, check it out also.
Hope that it helps.