OpenWatcom 1.9 RC4 has been
released (4/20/2010), and includes an OS/2 installer. This is an open
source release of the Watcom C, C++, and Fortran compilers. It now
includes wipfc, an open source tool for generating OS/2 help files,
intended to replace the buggy IBM tool that is no longer developed.
Michal Necasek has an article describing how to set up
an older version of Watcom, much of which is still applicable.
Source: OS/2 Warp News and Rumors