As far as I'm concerned, the closer you keep documentation to the code, the more likely it is to be kept up to date and the more useful it is likely to be.
That's why I try to keep all documentation in the same repository as the code, even user manuals, and try to keep it in a plain text format that can be easily managed by a revision control system.
It looks like you already have this one covered, but it is important to remember that actually using the documentation facilities in your chosen development environment (pydoc for python, javadoc in java or xml comments in C#) is the single most important documentation technique. They make it easy to write the documentation at the same time as writing the code.
If you rely on coming back and documenting things later, you may not get around to it, but if you do it as you are writing the code, then what needs to be documented will be fresh in your mind. C# even has the option to issue a compilation warning if the XML documentation is incomplete or inconsistent with the actual code.
Tests as documentation
Another important aspect is having good integration and unit tests.
Often documentation concentrates on what classes and methods do in isolation, skipping over how they are used together to solve your problem. Tests often put these into context by showing how they interact with each other.
Similarly, unit-tests often point out external dependencies explicitly through which things need to be Mocked out.
I also find that using Test-driven development I write software which is easier to use, because I'm using it right from the word go. With a good testing framework, making code easier to test and making it easy to use are often the same thing.
Higher level documentation
Finally there is what to do about system level, architectural, developer and possibly also end-user documentation. Many would advocate writing such documentation in a wiki or using Word or other word processor, but for me the best place for such documentation is also alongside the code, in a plain text format that is version control system friendly.
Just like with in-code documentation, if you store your higher level documentation in your code repository then you are more likely to keep it up to date. You also get the benefit that when you pull out version X.Y of the code, you also get version X.Y of the documentation. In addition, if you use a VCS friendly format, then it means that it is easy to branch, diff and merge, just like your code.
I quite like rst, as it is easy to produce both html pages and pdf documents from it, and is much friendlier than LaTeX, yet can still include LaTeX math expressions when you need them.
When writing highly mathematical code, I also find it useful to have a few wxmaxima documents in my project repository. Being plain text, these also branch, diff and merge nicely, but using a computer algebra system can help you consistency check your formulae as well as document them.