I'm trying to identify good practices and advice for students starting to write their PhD dissertations, and I cannot clearly recommend a "best" software to use. I used LaTeX for my own thesis and I was very happy with it, but my supervisors had to review a PDF of the text since they were not comfortable with raw text files.
On the other hand, MS Word is widely used I guess, and provides a very convenient set of tools for comment reviews, but it can be a real pain when the document increases in size (although the use of a master document and sub-files per chapter may be a reasonable solution).
What is your choice, as a student or as a supervisor ?