I have a wlan setup with that my neighbors can probably access if they're knowledgable enough. My setup includes wireless authentication using WPA/WPA2 mixedmode, WPA-PSK pre-shared key, and enforced MAC filtering.
Mixed-mode WPA2-PSK is probably good enough, as long as your passphrase is well-chosen. If you don't really need TKIP (WPA "1") anymore, consider making it WPA2-only (that is, AES-CCMP only), because there have been some attacks against TKIP recently.
MAC address filtering is a waste of time. MAC addresses are easily discovered and spoofed. Using a "hidden" SSID (a.k.a. "non-broadcast" SSID, a.k.a. "Closed Network") is also a waste of time.