As a hobby machinist, let me add a word of warning about drilling stainless -- it is no problem to drill using standard twist drills (sharp and good quality as HKJ suggests), but be careful about going too slow. Small diameter bits should be run at much higher RPM than most people realize -- stainless needs less than mild steel, but I'd run a 1/8" bit at about 1500 RPM. As far as feed rate, again be careful about going too slowly -- stainless cuts just fine UNLESS you let the tool rub, in which case it work-hardens in a flash. At that point it becomes much harder to drill! So select appropriate RPMs, and feed at a steady rate. Okay to pull back to clear chips from time to time, but be sure not to let the bit "dwell" at any particular point.
Far, far better to do the drilling on a drill press -- so much harder to control the feed rate if drilling with a hand-held drill. But either way, be sure to secure the piece you are drilling. Many people think the drill is a "safe" tool ... until the bit catches just before it goes through, and starts spinning the workpiece around. If the work piece is thin sheet, it can slice you open in a flash.
If you are drilling thin sheet, you might also consider punching the holes -- I've not tried this in stainless, so don't know how well it may or may not work, but easy to do in mild steel up to 1/16" thick, up to say 1/4" diameter holes. Set the sheet over a piece of wood backing, take your punch, and smack it firmly with a hammer. Voila! a slug is punched out. You will then need, almost certainly, to do a little hammering to smooth the area around the hole, but again very easy to do.
