My preference is to use a 15 gallon Sterlite rectangular bin (about 4 bucks at WalMart), and I have it up on a table next to the changing table.
I wash it out quickly with either vinegar or antibacterial hand soap each time I do diaper laundry.
It's not smelly, and since it's shallow, it's easy to wash out. No deo disks (which I think smell worse than the diapers). In dry winter weather when the we heat with wood, I don't even put a lid on it. The diapers dry out and when they dry out they are surprisingly not smelly.
But since I have a 2 story house, I have another setup upstairs. I use diaper pail made for disposables and a diaper pail liner.
I like that system upstairs, because the Sterlite bin is not as easy to haul up and down stairs as a liner full of dipes. But since it's tall and a pain to wash out, a liner is a must for that one, but liners are kind of pricey.
I actually have two liners, so I can put the fresh one in right away, so I have a place to put the upstairs diapers that appear while the liner is in the wash with the diapers.
The bin method is less expensive than a pail and liner or two, but both work just fine.
Thanks to Karen for this Frugal Baby Tip!
Photo Credit: Diaper pail, by Inga Munsinger Cotton on Flickr
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