Two local bands worth investigating, thanks to MySpace's sole redemptive function as an online music community:
The Falsies, a Brooklyn-based "powerpop" group featuring my co-worker and xylophonist extraordinaire, Collin. Definitely listen to "Judy and the Dream of Horses." Their shows, scattered through Brooklyn and downtown Manhattan, are (usually) free, very entertaining, and completely worth the subway ride. Check the "Upcoming Shows" section for more details.
Farm to Market, a folk trio of Columbia undergrads with an incredible lead singer and a simple but beautiful acoustic mix of guitar and cello. Give "In Silence" a listen (but don't forget the other songs, too). They periodically upload new music, so keep checking the page for updates.