I'd also like to point out MyHDL: http://www.myhdl.org/doku.php It allows the full power of Python (being just another module) while you're developing and testing, and when you're ready to compile to hardware you can compile the RTL subset of your program to Verilog or VHDL and take it to hardware from there.
MyHDL is great, more people should use it. I find it especially powerful for building test frameworks. I love using the power of Python for all the verification logic.
The creator did a good talk about it at PyCon Taiwan earlier this year: http://www.youtube.com/watch?v=LSgOpvr8FII