Hierarchical clustering
Also: agglomerative clustering, divisive clustering, dendrogram
Agglomerative clustering starts with every point alone and merges the two closest clusters at each step, under a linkage rule (single, complete, average or Ward). The merge history is drawn as a dendrogram, and cutting it at a height gives a flat clustering.
Example
Points 1, 2, 10, 12 merge as {1, 2} at distance 1, then {10, 12} at 2, then everything at a much larger height; cutting between those heights yields 2 clusters.