That’s kind of a tough one. Again, I’ll split it up into player and DM faves and try and narrow it down to a couple.
As a player, one of my favorite magic items was a Tome of Evil that Delban picked up in Lord Soth’s castle in Ravenloft. It led him down a dark, dark path, quite literally. Eventually it caught up with him, however, as the forces of evil around Soth came looking for the book, forcing Delban to flee into the Underdark with a band of adventurers heading for the City of the Spider Queen. It gave him a reason to “rethink his life” and he is now on a path back to neutrality at least, if not eventually back to the light side.
Another player favorite was Whelm, a magical, drow hating war hammer. It would relentlessly sound a warning like a giant bell in the presence of drow. In retrospect, we probably should have paid the warnings more attention or we would have learned that one of our party members was actually a drow in disguise a bit sooner.
As a DM, I’ve had a couple as well. One was a magical axe of black metal that Delban fitted with a magical gem in which he temporarily captured the soul of his one-armed paladin brother, Terun. His intent was altruistic, even if his methods were not. It’s a long story with a happy ending involving a whack-a-mole stick, a rebel illithid and a city saved from invasion.
Another DM favorite is not quite a magic item, but a magical place. It’s a borrowed idea taken from an old issue of Dragon magazine. The Inn Between Worlds is an extra planar inn which wanders about, not tied directly to any specific plane of existence but with doorways leading to pretty much any of them. Some of them even lead to other times. The Inn traditionally has wandered through the multiverse, never really tied down anywhere. However, I have given it a more or less permanent home on Occipitus, the plane that’s not quite Abyss and not quite Celestial that is now linked irrevocably with my bard/cleric Aeduin. Aeduin has taken over ownership and has offered it up as neutral ground where all are welcome to come and trade, talk, make deals, or just drink. You may find a elves from Krynn meeting with elves from Myth Drannor, gnomes of Mt. Nevermind trading with warforged of Eberron, or a beholder and a gold dragon just getting together for a drink.