I'm working on my "definitive" list of the greatest Dylan covers. It's been done a lot on the web, but I want to hear what you knowledgeable folks have to say on the topic:

In your opinion: What are some truly great Dylan covers? (Example: Fairport Convention - Percy's Song)

Also, what are some interesting Dylan covers that may be flying below the radar? (Example: The Roches - Clothesline Saga)

I'll go with the obvious, Jimi Hednrix "All Along the Watchtower".

off the top of my head,

bryan ferry's "it's all over now, baby blue"
rosanne cash's "girl from the north country"

and, of course, almost everything the band and the byrds did

A couple of my favorites:

Johnny Cash – Wanted Man
Dion – Baby I'm in the Mood for You
Fairport Convention – Si Tu Dois Partir (French version of "If You Gotta Go, Go Now")
John Hammond, Jr. – I'll Be Your Baby Tonight
Manfred Mann – If You Gotta Go, Go Now; Just Like a Woman; Mighty Quinn (Quinn the Eskimo); With God on Our Side
Leon Russell – Watching the River Flow
Mavis Staples – Gotta Serve Somebody
Rod Stewart – Tomorrow Is a Long Time
Taj Mahal – It Takes a Lot to Laugh, It Takes a Train to Cry

Bryan Ferry's deliberately and deliriously campy "A Hard Rain's A-Gonna Fall"

Them, "It's All Over Now, Baby Blue" (even if you've never heard this version, you probably know its crystalline electric-piano riff - Beck and the Dust Brothers built ODELAY's "Jack-ass" around it)

Jason and the Scorchers, "Absolutely Sweet Marie"

There's some pretty awesome stuff on the "I'm Not There" soundtrack; Mark Lanegan, Karen O, Ramblin' Jack Elliot and Anthony in particular. PJ Harvey's Highway 61 Revisited is interesting too.

George Harrison - "If Not for You"
Jimi Hendrix - "All Along the Watchtower"
Byrds - "Mr. Tambourine Man"
Byrds - "My Back Pages"
Adele - "Make You Feel My Love"
Manfred Mann - "Mighty Quinn"
Emmylou Harris - "Every Grain of Sand"

The Band - "I Shall Be Released"
Nina Simone - "I Shall Be Released"
Cassandra Wilson - "Shelter from the Storm"
White Stripes - "One More Cup of Coffee (Valley Below)"

and Antony could sing source code and it would be beautiful... so how could you go wrong with Antony and the Johnson's "Knocking on Heaven's Door"

And then there are covers from two of my all time faves: Stephen Malkmus' "Ballad of a Thin Man" and Beck's "Leopard Skin Pillbox Hat"

And I definitely agree with Harvey's "Highway 61 Revisited" and Emmylou Harris' "Every Grain of Sand"

Fairport Convention - Million Dollar Bash
Beck - Leopard Skin Pillbox Hat

Wilco with the Fleet Foxes- "I Shall Be Released"

Not a cover as such,but I love that duet of 'Chimes Of Freedom' he did with Joan Osbourne that plays at the end of the movie 'The 60s'

Jason & the Scorchers do a killer version of Absolutely Sweet Marie. Get that one in there.