There's a whole subculture to composting when you enlist worms -- usually red worms -- to do your dirty work.
Worm composting, also known as vermiculture, turns garbage into a rich, dark earth-smelling soil conditioner, which you can use to help your lawn, your flowers or your vegetable garden.
Worm composting doesn't just help you, but also the environment. The City of Vancouver in Canada publishes the Urban Agricultural Notes and supplies residents with worm bins and has a hot-line you can call to find out where to buy worms. Spokane, Washington posts information on worm composting to encourage its residents to give it a try. Not to be out done, the state of California has an animated, interactive game that teaches the basics of vermicomposting and its benefits (see The Adventures of Vermi the Worm).
To get started you need worms, a container and "bedding."
"A worm is a worm is a worm" may sum up your thoughts on the subject, but all worms aren't created equal. Don't try using your garden-variety night crawlers. They need to worm their way through dirt to eat and survive and don't dine on organic waste. For that you need red worms --Eisenia foetida (also known as red wigglers, brandling or manure worms) or Lumbricus rubellus (manure worm).
So you need red wigglers, but how many? Some vermiculture experts recommend a one-to-one ratio -- one pound of worms for one pound of garbage. Mary Appelhof, also known as the Worm Woman and author of "Worms Eat My Garbage" recommends two pounds of worms for every pound of garbage.
The other thing you have to keep in mind is that worms multiply like rabbits. (Or maybe it's more like rabbits multiply like worms!) Anyway, if you give them adequate food and a good home they can double their populations every 90 days. So, you may want to start out slow and with fewer worms than you think you'll need and the resulting worm population explosion will take care of the rest.
In terms of a home for your worms, there are special worm bins you can buy and no, you can't get away with using a generic composting bin. It must be made expressly for vermiculture. You can also make do with a "Rubbermaid" type tub and turn it into a worm bin or you can build your own. ("Worms Eat My Garbage" gives all the gory details.) Here's another worm bin plan (PDF format) from Seattle Tilth.
Location is important. Ideally your worm compost bin should be in an environment where the temperature ranges between 40 to 80 degrees Fahrenheit and red worms generally prefer temperatures in the 55 to 77 degree range. (Unlike backyard composting with bacteria who like it hotter than heck, worms are more like us.) Many people use a corner of their kitchen, or, if they have a worm bin outside and live in a place like Montana where it does get chilly in the winter, they move it inside for the cold months.
Care and Feeding
To give your worms a good home, you need the proper bedding that will take up anywhere from one-third to one-half of your bin. Keep in mind they like water and their bedding should be about 75 percent water. For example, you can use newspaper or cardboard that's been soaked in water and is downright mushy (see Making the Bedding). Once the raw materials have been soaked, wring them out so they're moist, but not dripping with water.
In addition to the bedding, you'll need to add something gritty -- a bit of soil, sand, cornstarch, saw dust or even ground egg shells. Think of this gritty stuff as a worm's dentures. Worms don't have teeth so the grit allows them to grind up the paper and food and digest their food.
When starting a worm bin (PDF format), don't just drop the little guys on top. Dig down to about the middle level and cover the worms up -- it's just like tucking in your little one at night. Then place the lid on the bid and give them a week or so to acclimate.
After about a week, your worms will need fresh supplies. Feed them fruit scraps, vegetable peels, tea bags and coffee grounds. Avoid meat or meat by-products as well as dairy products and oil foods. All those trimmings will do is attract pests like flies and rodents and can turn off your worms (see Worm Composting FAQ ). What about pasta? Experts are divided on whether to feed worms pasta and other grains, so let your worms tell you what the best diet is for them.
Of course, don't feed your worms inorganic waste such as aluminum foil or glass. Also avoid colored-ink newspaper as these dyes can be harmful. Basically use common sense and you'll end up with happy worms and plenty of compost.
After initially feeding your worms, it's best to feed them only once a week in small amounts. The idea is to give them only enough that they can eat, otherwise the "leftovers" (what they don't process) will end up making your compost bin stinky.
If your worms seem to be eating too slowly, you can either add more worms or you can try chopping up what you feed them. Much like turning the compost in a traditional compost heap (sans worms), chopping scraps up will speed the process along.
Harvesting Castings
Once the contents of your bin have turned to worm castings -- brown, earth-looking stuff -- it's time to harvest the castings and give your worms new bedding. Worm castings can be harvested anywhere form two and a half months to every six months, depending on how many worms you have and how much food you've been giving them.
There's more than one way of harvesting worm castings, but one popular method is to move everything to one side of the bin. Then push the partially composed food to the middle and add additional food scraps. Replace the lid. The worms will head for their food. Once they've relocated to the food pile -- it should take about two weeks -- simply put on a pair of gloves and remove the worm castings without taking out any worms. Once they've been harvested, replace the bedding.

http://www.composting101.com/worm-composting.html