Central Ubud can be covered on foot, but you'll need wheels to explore the extended vicinity. On the main streets, you might be accosted every few meters by people offering "transport"; prepare to bargain hard, but always keep bargaining rules in mind: start low, end with a smile, and enjoy the interaction.
It also should be noted that sidewalks throughout Bali are simply the tops of sewers and only 2 ft wide, which can make for uncomfortable single-file walking as traffic screams past. Ubud is generally quieter and the streets calmer than the more urbanised parts of Bali (although anywhere in Indonesia, "calmness" is a matter of opinion!).
The Bemos are the local minibus transport that the Balinese primarily use; the Bule (foreigners) are welcome, too, and should expect to pay about twice what the locals do (Rp 2,000 instead of Rp 1,000 - but you may be asked for more). The Bemos are rented by the driver for the day and he gets a cut, so do treat your drivers well, and expect the same in return.
While many drivers would be happy to do so, metered taxis from down south are officially not allowed to pick up passengers in Ubud and local drivers might have their say about this, perhaps even trying to prevent you from getting in. In practice metered "Taksis" are only seen dropping tourists off from the airport.
Most local transport comes in the form of Kijang SUVs or minivans that can be hired (with driver) for specific trips. Look for the circular yellow "E" logo on the windshield certifying them as Ubud Transport Association members. You can (and should) haggle a bit over the price and you should be able to pay less than with metered taxis. A short trip is about Rp 20,000 and drivers will be glad to wait for you for a return fare. Also, any guy with a motorbike is implicitly in the transport business and bike rides are about half the price of a passenger vehicle.
You can also rent a push bike - a regular bicycle, for about Rp 20,000 a day. There's a large selection available at the corner of the football field. You can arrange a half-day trip involving a gentle downhill cruise from the top of the island back to Ubud on rented bikes. Apart from a very few short, sharp uphill sections, the ride is very relaxed and is well worth the time if you want to see the surrounding country in a less "touristy" way.
This work is licensed under a Creative Commons Attribution-Noncommercial-Share Alike 3.0 Unported License.Based on a work at Wikitravel.org & Traveldudes.org.