There are amazing digital archives resources on the Internet these days. Of course, these are only a tip of the iceberg in comparison to what these archives have in printed and microform resources on site. For the state of Alabama, I started listing many of the goodies at each of these websites, and just gave up; it was literally a couple of hours to list the treasures! Here's what you can hope for: letters, diaries, photographs (people and places), postcards, yearbooks, reports, histories (printed and oral), records (vital, census, military), oral histories, audio files, online videos, newspapers, directories, etc. Sound interesting? Check them out! And don't be put off by the fact that your ancestors didn't attend the universities listed here. The university archives contain much information about people and places within the state, whether or not they pertain to the universities themselves.
Alabama Department of History and Archives (ADAH) - http://www.archives.alabama.gov/searchcoll.html
Auburn University Digital Library - http://diglib.auburn.edu/browse.html
Birmingham Public Library Digital Collections - http://www.bplonline.org/resources/Digital_Project/Collections.asp
University at Alabama, Birmingham Digital Collection - http://contentdm.mhsl.uab.edu/cdm4/browse.php?CISOROOT=%2Foralhistory
University of Alabama Libraries Digital Collections - http://content.lib.ua.edu/digital/about.php
University of Alabama School of Law Special Collections - http://www.library.law.ua.edu/spcoll/colls.htm
University of North Alabama Digital Collections - http://www.una.edu/library/about/collections/digital.html
Note: You can search across all the above collections at AlabamaMosaic.
Lawrence County Archives - http://www.lawrencecoarchives.com/pages/files_available.html - probate, deed, and marriage record indexes
Madison County Records Center - http://www.co.madison.al.us/mcrc/ - marriage records indexes from 1809 to 1899
Mobile County Probate Court - http://www.mobilecounty.org/probatecourt/recordssearch.htm - real estate, marriage, election, estate claims, unclaimed property records indexes
Check out my Alabama Historical Online Directories page.