The American Academy of Pediatrics recommends no more than 2 hours of TV per day for children over 2.
Ever since we had kids, Elisa and I have really had to work hard to cut TV out of our lives. We were raised on Sesame Street, Three's Company, and the A-Team (I love it when a plan comes together), so TV has just sort of come naturally to us. Once we had kids this recommendation from the AAP weighed heavy on us, especially since they recommend NO TV for any child under 2, so we've made an honest effort to prune it from our lives.
First, we tried to cut it out completely for a couple of years when our first was very young. It saved us money and tons of time, and we got to play with Cason a lot more. It was great. Except during football season. And March Madness. And the NBA playoffs. So, basically it was okay in July.
When our kids got older, we got a DVR. This has been great, too, because now we can record shows that we know are okay for them, and we can skip the commercials. (Our kids even know how to do this with the remote. Sometimes we catch them watching the commercials, and when they realize it they say, "we know, we know...they're only trying to get us to buy stuff!) It also allows us to watch our favorite shows whenever we are able to (i.e. after the kids are asleep).
But our latest (and by far the most fun) practice is a jar of marbles.We were trying to figure out a way to give the kids some control over how much TV they watched and when. We had these two small mason jars and some marbles, so we filled one of them up and put it in our bedroom, and put the empty one by the TV. We told the kids that every morning they could take two marbles out of the jar in our room and put them in the jar by the TV, and that each marble represented 1/2 hour of TV. They could watch two shows today, or save them until tomorrow and maybe watch a movie.
They quickly learned to budget their TV time, save it, and spend it appropriately. Now the kids do a lot more imaginative play, reading, embroidery, and other things. Sure, they still watch TV, but not as often. And whenever they ask to watch TV I say, "it'll cost you a marble!"