I would just like to take a minute and praise the money-saving glory that is the cloth diaper...
When I was prego and researching all of the different baby care items out there (b/c researching is just what I do), I discovered how much money I could save by using cloth diapers instead of disposables, for my lovely daughter (not to mention the probable health benefits in exposing her to less chemicals I don't know how to pronounce the name of!)
After more research, I decided to use BumGenius 3.0's, which I purchased from a wonderful WAHM (work at home mom) run website. At first I ordered just one so I could see what it looked like and make sure it was what I wanted to use, then I ordered a dozen b/c you will usually get a better price when you order in bulk. Later on, when the same site was having a sale, I ordered a few Happy Heiny's, which are similar to BGs, but have more color options (and cost about a dollar more) ;D
I spent about $270 and ended up with a diaper stash of 17 cloth diapers, and that is what I have been using from ages 3 months until the present (19 months), with a few vacations here and there when life was too hectic for laundry--like when we were moving to our new house, and when we were out of town.
I always have a pack of disposables on hand for times when I am lazy and don't get the laundry done fast enough. I also use disposables when we are leaving the house for an extended period of time, and I use extra absorbency Pampers for night-time (we live with enough sleep issues around here without having to add several overnight diaper changes to the mix). So I end up buying about 1 pack of regular disposables and 1 pack of night-time disposables per month (getting them super cheap with coupons, of course).
This system of mixing mostly cloth with some sposies has saved us so much money. It was a little intimidating at first to drop almost $300 for the initial cloth diaper purchase, but when you do the math, even adding the cost of water used to wash the diapers, it still ends up being MUCH cheaper.
A couple of other things to keep in mind that make using cloth diapers cheaper:
*Cloth diapered children are generally potty-trained at an earlier age b/c they can actually feel when they are wet.
*You can use the same cloth diapers for subsequent children.
*Cloth diapers retain a great resale value!
I am quite pleased with the diapers I chose to buy, but I will say, you could manage to build a stash in cheaper ways than I did...
You could buy used diapers from ebay, craigslist, and places like Diaper Swappers! Also, there are so many different types of cloth diapers, which means you could make the endeavor as cheap or expensive as you like. Pre-folds and a few covers would get you by in probably less than $100, or you could get real swanky and shell out some bucks for the coveted GoodMamas which run almost $30 a pop. You would probably still save money in the long-run, especially if you use the diapers for more than one child, and GMs have a very high resale value!
You can also cut costs even more by using cloth wipes, which can be made from anything from organic bamboo, cotton, or hemp to flannel bought at JoAnn fabrics and cut yourself. Cloth wipes actually are a lot less hassle too b/c you can put a cloth wipe inside a cloth diaper when they are both icky and throw them into the diaper pail together. Much more fun than using a disposable wipe and forgetting to take it out of a diaper, resulting in either fishing it out of an icky diaper pail, or accidentally washing it, causing a bunch of laundry fuzz.
A lot of people make their own wipes solution.
And along with the theme of my most recent entries, I have to mention the fact that cloth diapers have a much better environmental impact than disposables do. Although this is constantly being debated, the research findings seem clear to me.
Here are a couple more good links which delve into the cloth vs. disposable issue further: