How do I change NEI to cheat mode?

This is a config option to lock NEI in Recipe Mode only. It's designed for people (like me) who want to commit to a Survival game, but can't help themselves when it's so easy to cheat in items. This option is on by default when you download NEI.

You can turn this off in the configuration file. Go to the config folder (probably C:/Users/YourName/AppData/Roaming/.minecraft/config) and find NEI.cfg. Open it with Notepad, and change the line that says lockmode=0 to lockmode=-1. This will unlock the option to switch to cheat mode in the options menu in-game.

If that doesn't work for whatever reason, cheat mode can be manually set by changing the line that says cheatmode=0 to cheatmode=2.

Just to add to the previous answers:

An element I wasn't aware of was that after setting NEI to cheat mode, you need to enable the Items option, under Utilities. (This applies to the 1.7 pack I'm playing, anyway.)

This is done by left/right clicking the stone block icon on the right.