You don't mention what model your iMac is, but here is the link to the iFixit guides which will cover HDD replacement if it turns out that is what you need to do...
http://www.ifixit.com/Browse/iMac_Intel
Since you are asking about sourcing your own HDD, I assume you are out of warranty or AppleCare? If not, take it in at once.
Once we know what model iMac you have (About This Mac, More Info, Hardware Overview, Model Identifier) we can recommend a drive for you (newer iMacs require an HD with an internal temperature sensor). They are normally 3.5" SATA II drives similar to the Western Digital Caviar Black and can easily be got in 500Gb, 1Tb or 2Tb depending on your budget.
If you are installing it yourself, you will need a couple of cheap suction cups from the local poundstore plus a Torx screwdriver set from eBay.
I assume since you mentioned "cheap as possible", I assume a decent SSD will be out of your budget but I can personally recommend my OCZ Vertex2 120Gb 3.5" drive as a simple drop-in plus a reasonable external HDD for bulk storage of pictures and music (don't forget to back it up of course!). Other good brands of SSD are OCW and of course Intel.