UPDATE - Information from the U.S. Department of State website: http://travel.state.gov/travel/cbpmc/cbpmc_2223.html
WITHIN WESTERN HEMISPHERE
WASHINGTON – The U.S. Departments of State and Homeland Security announced June 8, 2007 that U.S. citizens traveling to Canada, Mexico, the Caribbean, and Bermuda who have applied for but not yet received passports can nevertheless temporarily enter and depart from the United States by air with a government issued photo identification and Department of State official proof of application for a passport through September 30, 2007. The federal government is making this accommodation for air travel due to longer than expected processing times for passport applications in the face of record-breaking demand.