This is a whole-class spelling game that I played with a class last week. It is very fun and got them excited to practice their spelling words. I would recommend it to any teacher looking for a way to enliven their spelling lesson or give students something fun and productive to do with the entire class.
The game is called Sparkle. The particular teacher I was subbing for had a cute little wand made especially for games like this, which I used to point at students on their turn to keep the rhythm going quickly.
For this game, it's probably better to play when a spelling test is approaching because it's good for students to have some familiarity with the words, as opposed to playing the day you give them the new list. Having time to study and learn the words will help them play better.
First, everyone can stand or sit in a circle. The class I was subbing just formed a big circle around the classroom. Pick a word from the list and a person to start the game. Say the word, and the first student says the first letter of the word. The next student says the next letter of the word on and on around the circle until the final letter is spoken. After that, the next student says, "sparkle," a signal of the completion of the spelling word. The student next to the one who says "sparkle" then sits down. They are out. Give the class the next word. The same thing happens with each student providing one letter from the word, one student saying "sparkle" once the word is completed, and the next student sitting down.
Students are also out and sit down if they do not give the correct letter for the word, or if they hesitate too long because they don't know. You can decide how to proceed when students make mistakes. The next student will have to give the correct letter to the word, and this sometimes results in several people having to sit down because they've forgotten the word or weren't paying attention to the letters already guessed. After several people have guessed the wrong letters, you may choose a different word and come back to it. At the end of the game, make note of the words that gave the class particular trouble so that they can practice with them more before the spelling test. You can continue playing the game until one winner is left from all the players.
The game eliminates players as much from chance (their position in the circle after someone says "sparkle" means they have to sit down, even if they know how to spell all their words) as it does from mistakes. Let students who sit down know you will play the game often and that it's not a big deal for them to lose one round.