The best way to see Toronto is on foot (perhaps unless you visit in the winter, in which case taxis are relatively inexpensive and you can use the subway system as well). Young street is the main road through the center of downtown. From here, you can reach virtually all the major streets in the area. Places to definitely check out during your stay include:
The waterfront, especially in the warmer weather. From here, you can catch ferries to Toronto Island and enjoy the various restaurants, gardens and activities along the water.
St. Lawrence Market - filled with shops boasting the city's best meat, cheeses, baked goods, coffees, fruits and vegetables, the market is the perfect place to both enjoy a great breakfast or lunch and to people watch! It's definitely a "must visit".
The Distillery District - The old distillery has been turned into a wonderful set of shops, restaurants and bars and service providers in a unique setting. It is walkable from downtown on a good day, or you can take a cab. Beer drinkers, make sure to visit the Milltown Brew Pub while there!
The University area - old churches converted into libraries, opera houses and museums along with several green spaces make for a nice walk through this area. The Eaton Center - yes, it's an indoor mall. But it is great for getting out of the cold weather during the winter and its shops and restaurants could keep you entertained all day. It's also a beautiful building inside and at least worth a visit for this!
Other sites worth visiting include Chinatown, the Hockey Hall of Fame and the CN Tower.