Effect:

The cards are spread out between the magician's hands and the spectator is instructed to take a card from anywhere in the pack. The card is replaced and the deck is squared. By "feeling the heat" on the backs of each of the cards, the magician is able to tell which was the last card selected.
Read on for a few cool variations. You can practically do the same trick three times with three different endings and it will seem like three completely different tricks!

Secret:

First, let your friend shuffle the deck. Shuffling always adds to an already good card trick. Fan the cards out in the best way that you know how, and ask your friend to select any card from anywhere in the entire deck. As they take it out, square up the deck. Cut the deck somewhere in the middle, taking the top half with your right hand. Tell them to look at their card and remember it.

Outstretch your left hand, and have them set the card down on that half of the deck. While they are doing this, or while they were looking at their card, whichever is less obvious, glimpse the card on the bottom of the pack in your right hand...and remember it! Instruct them to place their card face down on that packet in your left hand. Drop the right hand-packet on top of the left-hand packet. Once again, hand the deck to your friend and tell them to cut the deck and complete the cut. They can do this as many times as they want, but only single cuts at a time. (This will not affect the order of the cards.) Take the deck back.
What you have just done is placed a key card right above their card. You don't know the identity of their card, but since you know the card right above it, it is almost as good! Now, there are several finishes to this trick. All of your work is practically done, and here is where your acting ability is put to use. Make these finishes as dramatic as possible, act as if you yourself are amazed, and what an incredible sleight-of-hand artist you are.

Feel the Heat:

Pretend to feel the heat that they left on the card when they touched it. Set the deck down and slowly feel the back of each card, turning them over and tossing them, face up, into a pile off to the side. They will be watching your eyes, so do NOT look at the pile. Instead, stare at the face down deck, and use your side vision to just glimpse the card. Pretend to be concentrating on the face down deck. The longer it takes, the more dramatic it can be. When you see the "key card" tossed off to the side, pause. Take a deep breath. Say "this is it!", and let them turn over the next card. They will be amazed.

Feel the pulse:

A great variation, although it's pretty much the same trick, the audience will think it is a different trick entirely. Just don't do these two tricks directly in a row.
Spread the cards face up across the table. Ask your friend to point with his index finger. Grab their wrist as if you are going to feel their pulse increase as their finger slides across their card. Make several passes back and forth across the spread. Slowly slow down the motion and stop on the card that is directly above the "key card." Touch their finger to their card. They will think you can really feel their pulse increase. They will be amazed.

A Gambling Variation: (how to make money with this trick)

A great way to get your friends to like you! If you get real good at the Feel the Heat ending, try this: Instead of stopping at the key card, go about seven cards to far in the deck. Say "The next card I turn over will be your card. Wanna bet on it?" Of course they will, because they already saw you pass their card. (Make a reasonable bet like under 5 bucks, and make sure they will pay you, because I am assuming that you are honest and will pay them if you mess this up - which might happen occasionally for some reason or another.) Get them to put their money out on the table. Reach into the face up pack, and turn their card face down. A little sneaky, but now you are 5 bucks richer. DON'T keep the money. Give it back. They will know you are a true friend and they will like you, and they will never be bitter about the trick. Trust me, don't keep the money. If you win the money from a real jerk, just give the money to a cute little kid. They will appreciate it the most - and that's just the kinda person you are.