Thumb Joystick

This is a joystick very similar to the 'analog' joysticks on PS2 (PlayStation 2) controllers.
Directional movements are simply two potentiometers - one for each axis. Pots are ~10k each.
This joystick also has a select button that is actuated when the joystick is pressed down.

Note: You will probably need a Breakout board also.