Looking to read manga online legally? It's a can-do! Free sites usually post anything they can get their hands on without regards to the authors, and this isn't legal--it's piracy. These free websites post scanlations by fans who aren't considering the feelings of the authors who put so much effort into these stories. Before, these free sites were the only option, but the manga companies are beginning to take the hint--there are nowways to read manga online legally.
Go to the publishers! Viz Media, TokyoPOP, Dark Horse and Del Rey are a few examples of manga publishers in North America. Believe it or not, it is becoming standard practice to have preview chapters online--for the first several pages of each volume, or even the whole first chapter, they'll usually have an online flash reader available. The "Shonen Sunday" label from Viz Media keeps the first chapter of each volume available on their website, as well as the chapters from the "up and coming" volume as they're translated, so you can read the whole volume as it comes out! Dark Horse also provides a very good preview of their works on site, including comics and other graphic novels. These are scans provided to you directly from the companies who have explicit permission to publish these works. The quality of the scan is better, the translations are better, and above all they are perfectly legal since they own the rights to the English version. No guilty conscience required!
Another good option is the website MangaFox. It is an online reading site, but they are sensitive to the copyright issue. MangaFox lists, but does not post, licensed manga. At the same time, they will post unlicensed titles for all to read freely. As reported by AnimeNewsNetwork, MangaFox is also know for directly obeying the wish of authors--there was an occassion when Takahashi Rukmuko (Inuyasha, Ranma 1/2, Rin-ne) requested that all her works be removed from the site, and MangaFox has complied. The issue might be considered "up in the air," but MangaFox provides manga from Japan that we would otherwise not even know existed. The publishing companies might actually get a bit of a boost from it; if a reader noticed that a favorite is getting licensed, they'll have it set on preorder in no time. Sites like this actually inspire interest in series, and still respect the wishes of authors and the boudanries of copyright holders.
Some scanlation groups are also respectful towards licenses-- Aku-Tenshi, Blissful Sin, Aerandria and others will drop projects and no longer provide them after a title has been licensed to a North American publisher. Like MangaFox, they only provide titles that would not usually be available to readers from the States and Canada.
Reading manga online legally can become a minefield if you don't keep an eye out, but don't stop and give up. They're beginning to realize that having manga available online is a good thing, so patience is a virtue. It won't be long before the "latest volume" of every series will be listed on every website; I'm sure the publishers are beginning to come to this conclusion, seeing how they lean in that direction. Remember to look to the publishers first and foremost, and be sure to support the authors by purchasing their books when they become available!