I haven't personally used it, but I know some friends who have been very happy with rent the runway.
Personally, I found my prom dress at a sale at JC Penny's. Admittedly, this was 10 years ago, but it was $40 (down from I think $100?). Not outrageous, in my opinion, for a one-time formal event. The killers are hair, make-up, nails, waxing, limos, etc etc. DIY these options and you'll save a huge chunk of change.