How to lose a fat gut?

I'm not overweight, my BMI is pretty smack bang in the middle of where it should be. I am also not in such bad shape, I cycle to work everyday and the other week did a 16km walk (a third was up a mountain and with some running sections) with no trouble.

Yet, nonetheless I have quite an ugly fat gut.

What is the best way to lose this?

I've read situps are ineffectual, they simply tone the muscles beneath the gut fat. Is there anyway to shift the fat elsewhere or any special exercises aimed at that area that work?
How to lose a fat gut?
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