Here's my setup for printing through Createspace, assuming you're asking about self-publishing and not submitting an MSS to an agent/publisher. Some of these things you will want to tweak depending on how many pages you want your book to be. The longer it is, the higher the cost-of-production per paperback will be. My personal goal was to make my paperbacks identical to one you might pull off a shelf at a bookstore.
Page Setup
Margins
Top: 0.65''
Bottom: 0.5" (leaves a little extra space for a page number beneath)
Inside: 0.65"
Outside: 0.35"
Gutter: 0.18" (assures the edge of the page is not lost to the book's inner binding)
Pages
Multiple Pages: Mirror Margins
Paper
Paper Size: Custom
Width: 5.25"
Height: 8"
(Many use 6x9, but I prefer a smaller size since I find larger books awkward to carry/read)
Paragraph
Indents and Spacing
General
Alignment: Justified
Outline Level: Body Text
Indentation
Left: 0
Right: 0
Special: First Line
By: 0.25"
Spacing
Before: 0
After: 0
Line Spacing: Multiple
At: 1.05 (gives a little extra space between lines so the text isn't so cramped and is easier to read)
These are just basic text settings. My chosen font was Palatino Linotype, 9.5. You'll also want to learn about page/section breaks and headers/footers (I alternate every other page with author name/title on the top, with the page number on the bottom). I also imitate other standard publishing things like beginning each chapter halfway down a new page, using drop caps, etc. The file I used as reference to this post was 104,000 words and came out to 332 pages in the final product, after inserting title page/dedication/maps and other front and back matter. Like I said, you may wish to play with margins and font size to make your book more cost effective, or to lengthen it if you want it to have more thickness.