On the Macintosh, the basic editor is Simple Text [footnote 2]. However, I've been informed that Simple Text can't handle more than 32K of data (making it apparently worse than even Notepad), but that the editor which comes with Inform for the Mac is perfect for the job [footnote 3].
There are several text editors available for UNIX systems, such as vi and emacs (and joe, and jed, and so on). I doubt that many people who are actually using a UNIX-type operating system would be reading a "Dummies"-type book, but I include the reference for completeness. (And also so I don't get hate mail about being Windows-centric. Sorry folks, it's what I use. Deal with it.)
The editors I mention here come with the respective operating systems. There is a myriad of other editors out there, some free, some not. Use whatever you're comfortable with.
It would also be handy to have a program to play the games you create. I mean, unless you're really good, you'll have to test what you write. (And if you are that good, why are you reading a beginner's guide?) A program that plays story files is called an interpreter. You can find them at the I-F Archive. I use Frotz. There are others, ZIP being the only one on a popularity level with Frotz [footnote 4].
And yes, folks, it's really free. I'm too cheap to pay for this.