Perhaps the following would be of interest:

• Aligning sequence
• Align::NW
• Simple String Alignment
• Search for identical substrings

Also, XS Mechanics, which discusses the coding of Align::NW, and has some excellent resources on the Needleman-Wunsch algorithm.

Update per biohisham's suggestion: See also BioPerl's implementation of the Smith–Waterman algorithm, at BioPerl's SimpleAlign documentation, or at CPAN's: Bio::SimpleAlign.