For those of us unfortunate enough to have "issues" with neighbors, I highly recommend you get from the library, or buy, the following. Written by lawyers, with an emphasis on resolving issues yourself. The book tells you when to stop trying yourself and get help, and is very clear.

Neighbor Law 
Fences, trees, boundaries and noise

"all the plain english information you need to solve neighbor problems"

[WWW]Nolo Press 
Pub. Date: Feb 2006 
Edition: 5th 
Pages: 368 pp 
ISBN: 1-4133-0060-X

I will write this from the viewpoint of somebody who is annoyed, and where the issue is noise. But the points work just as well if a neighbor comes to you to mention something that you feel is perfectly reasonable.

Talk to you neighbor (after some preparation, see below). In many cases, what's music to the ears of one person is noise to another. Simply pointing out that some noise is rather loud to you can help resolve the problem. Most people are quite considerate and willing. 

  • Pick a good time to talk. It's typically best to do so at a time when you are not upset (and they aren't either; don't interrupt a big fight between kids and parents, for instance), and both of you have some time. ("I'd like to talk to you, is now a good time?", "Ok, but I do need to talk to you. What time works for you?"). Obviously, if there are crying children, boiling pots on the stove, etc. now is not a good time no matter what people say :-) 

  • Introduce yourself. Anonymous discussions are not effective. 

  • Describe the problem in one sentence. Be specific, and give two examples of occurrences. ("every Tuesday night, there seems to be a party in your back garden. Last week, it was from 10pm until 3am. This week, it lasted until 4am") 

  • Describe how this impacts you or how it makes you feel ("As a result, my baby and I can't sleep") 

  • State the desired solution or change ("I'd like to ask you to move your guests indoors after 10pm") 

  • State why this will help ("Of course, you should enjoy your parties. By moving indoors, the noise will be contained and I will be able to sleep") 

  • State what the consequences are if things don't resolve ("I would like to work this out with you, rather than to have to go to the City", or "If we can't work this out, I will contact the City Mediation program to see if we can find a solution") 

  • Ask for a commitment ("So, is it ok for you to move your guests indoors after 10pm?") 

  • Listen to the answer. An unequivocal 'yes' is great. Vague answers ("I'll think about it","we'll see" etc.) should be clarified. "Is that not a solution that works for you? Could we find some other arrangement? Would it be possible to hold the party somewhere else?". You always have options: new suggestions, other actions, escalation (going to the Police should really be a last resort unless you feel threatened), or walking away and accepting that it can't be changed. Keep going until you can both say 'yes, that is what we will do'. If the answer is 'no', you've already stated what your next action will be in a previous point. 

  • No matter what the outcome, thank your neighbor for taking the time to listen to you, and to talk things over. 

  • If you committed to doing something, do it promptly. Neighbor disputes sometimes linger, and eventually fester.

In preparation for your talk, you may want to:

1. Keep a short log for one or two weeks, and make notes of when the problem starts, stops, what happens, etc. Having such a log will help you ascertain if there really is a problem, or if you simply notice something because you've become sensitive to it. It will also help you be specific when you do go and discuss the issue with others.

2. Make specific notes of any interaction you have with the neighbor(s). If there are conversations, write down what was discussed, and who you spoke with.

3. Know your rights. Some things that annoy you may violate an ordinance or law. Knowing that makes your comment stronger, and gives you more options to deal with the issue. 
Neighbor Law, by Nolo Press and linked to elsewhere on this page, is very good and talks about fences, trees, noise, and your options. 
Every Dog's legal guide, by Nolo Press, is a must-have manual regarding barking, dog laws, leash laws, etc. 
Both books are available from Search for the title on the website, or look under 'property law'. The Library usually has these books, too.

4. Know your options: It's always useful to know what might help to resolve the problem. Maybe a barking dog needs a kennel or crate. Maybe power tools can be used around a certain time you're not at home, or don't care so much. Having a plan of options means you can more easily overcome a 'no' with new suggestions etc. and keep the conversation going.

5. Consider mediation. The City of Mountain View offers mediation services. Mediators are trained, independent facilitators who will guide a discussion between both parties. Mediation can be very helpful if emotions rise, or if an issue is getting very serious. [WWW] city_hall/ community_ development/ preservation/ renters.asp

6. Stay on topic. It's very easy for a discussion, especially one that is at risk of getting emotional, to wander. If you mention noise due to regular parties, and your neighbor says "I don't like your lawn mower, either", don't get side-tracked. Instead, you could state that you hear what they are saying, and you'd be happy to discuss that at some other time.

7. Last but not least: stay cool. It's not a fight, you have a request that is specific and you believe, after some research, to be reasonable. Be polite, so you can talk in the future and enjoy your great neighbors!