The following excerpt is from 2009 INDIE Finalist, “Success, Your Path to a Successful Book,” by Maralyn D. Hill and Brenda C. Hill.

Http://www.SFWA.org at its Writer Beware site has excellent descriptions of vanity presses, subsidy publishers and self publishing:

• “A vanity publisher prints and binds a book at the author’s sole expense. Costs include the publisher’s profit and overhead, so vanity publishing is usually a good deal more expensive than self-publishing. The completed books are the property of the author, and the author retains all proceeds from sales. Vanity publishers may exclude objectionable content such as pornography, but otherwise do not screen for quality-they publish anyone who can pay. For an extra fee, some may offer editing, marketing, warehousing, distribution, and/or promotional services (often of dubious quality), or they may provide various-priced service packages that include differing menus of extras.”
• “A subsidy publisher also takes payment from the author to print and bind a book, but contributes a portion of the cost and/or adjunct services such as editing, distribution, warehousing, and marketing. Theoretically, subsidy publishers are at least somewhat selective. The completed books are the property of the publisher, and remain in the publisher’s possession until sold. Income to the writer comes in the form of a royalty.”
• “Self-publishing, like vanity publishing, requires the author to bear the entire cost of publication and also to handle all marketing distribution, storage, etc. However, rather than paying for a pre-set package of services, the author puts those services together himself. Because every aspect of the process can be out to bid, self-publishing can be much more cost effective than vanity publishing; it can also result in a higher quality product. Completed books are owned by the author, who keeps all proceeds from sales.”