I just returned from Kauai this week. The best place we snorkled was by far at Tunnels. Its on the same beach as Ha'ena Park North of Hanalei.

There's limited parking so you need to get there early or walk up the beach from Ha'ena Park. There's an easy flat entrance a few hundred yards back up the road from the Tunnels parking area. The parking area itself only accomodates about 10 cars. Follow the scuba classes early in the morning to find the entrance and the swim route to the reef.

The best things about this place are the scenery and the reef drop off about 60 yards off the shore. Snorkeling over the reef drop off is an awesome experience. The beach was nearly empty everytime we were there.
Beautiful schools of fish and accasionally turtles and rays.

Since this was my first snorkeling experience I don't have much to compare it to, but wow is what i have to say. Colorful fish, clear warm water, and lots and lots of giant turtles. The turtles were the highlight. I recommend good sandles that keep your feet cool from the sand, and park out there at early or late times during the day so you don't have to park far away.

I noticed a reviewer that said teh only good beach on Kaui is Poipu Beach park. I feel truly sorry that person visited kauai and obviously never went to the north shore and Hanalei. If they did, surely they wouldn't make the statement (we went to Poipu one day and left after 10 mintes and made the hour drive up north to go back to Tunnels). Basically the north shore is more lush, and the beaches are much much better (Caveat, about right now the north swells start in and you can't really swim in teh north shore beachs, but still visit and enjoy the views. Better yet, delay your trip 6 months till spring so you can swim, trust me its worth it). Tunnels and Ke'e are the 2 we visited but I am sure there are others. Basically beautiful backdrops (bali Hai, Napali) great snorkeling, and when the north swells aren't happening the swimming is really good. Overall they really look like some paradise fantasy island. And no crowds either (unlike Poipu). Hanalei is a nice funky town also. I particularly like the one lane bridges they furiuosly fight to keep. Reason: keeps the tour buses out, gotta love that!!

Tunnels Beach was amazing! If you love to snorkel, or want to learn, then this is the beach for you. Some tips: Get there early (before 9 am) due to extremely limited off-street parking. Also, you want to get an early start so that the swells are managable. You absolutely need reef booties if you intend to stay in the shallow water, or fins if you might go out deeper. Reef booties are a precaution. You never want to intentionally step on any part of the reef, but I had a few close calls in shallow water when waves pushed me into the reef (and I had to step down briefly to keep myself upright and from getting scraped-up). Be careful in very shallow water, if you are over the reef, for this reason. Try not to get a reef cut or scrap, they take a long time to heal. The currents here can be very strong at Tunnels. I was there in mid-October and it was intense from storms. In addition to crashing in, there's a current that flows right to left (the right side of the beach is a little mellower). Without fins, it is extremely difficult to swim against this current. THE REWARD: The view is spectacular!!! The snorking can be great! You can see fish in 3 feet of water to 50 feet of water since there is such a large reef protecting you from the full swells of the open ocean. Another tip: Wear a rash guard (surf shirt). I used a full sleeved one with a mock turltleneck collar (with a full UV rating). I have a very fair skin color and this prevented me from getting any burning. Available at most surf store, it's a wise investment!!! If currents and waves sound too scary, then try Lydgate Beach, it's relatively safe (has a man made reef-break). Probably better for small children--no swells. We saw one lschool large fish there. Was worth the trip.