Don't listen to anyone working in Cuzco or especially in Lima. No one there will tell you that this is possible and they all steer you towards the expensive trains for tourists.

For those not doing the Inca Trail, the cheapest way to see Machu Picchu is to first take the 4 soles bus (3.5 soles=$1) from Cuzco to Ollantaytambo (O-town) via Urubamba. I recommend staying in O-town at the Hostal Miranda since it is quiet (good lunches, but eat dinner on the main square).
At 6pm of the day you want to travel you can buy a ticket and take the local train at 8:30pm to Aguas Calientes for $10. If you want to buy the ticket the day before you have to pay $25, but if you wait until 6pm on the day you want to go you can buy it for the 8:30pm train. The guy at the station says that it is almost always possible to do this, and he was hanging out at the Hostal Miranda when I was there, so you could pester him further. This is so despite all of the signs at the station saying it is a locals-only train and not meant for tourists or the promotion of tourism, etc. etc.
There is no road between O-town and Aguas Calientes, and it would take about 3 days to walk it. Aguas Calientes has many, many guest houses where you can get a bed for 15 soles. The return train from Aguas Calientes to O-town is at 6:10am and that you can buy the day before.

In Aguas Calientes I bought the $4.50 ticket for the one-way bus to Machu Picchu in the morning, and I walked back in the afternoon. It wouldn't be such a Herculean effort to walk both ways, but I thought I'd save my breath for walking up to Huayna Picchu once I was at Machu Picchu. Besides, if you walk back you can see what Peruvians do with their garbage: they throw it next to the river!
They say the buses go every half hour, but in the mornings when everyone wants to go, they generally leave when full. The day I was there the number of tourists wasn't much, and it wasn't necessary to get to the mountain at the crack of dawn. I was very lucky and had no clouds or fog to contend with.

Normal admission is $20, but if you are a student it is $10. Usually you have to be less than 26 years old to use an international student card for Machu Picchu, but I got in for $10 with a card that expired 2 years ago plus I am 37 years old-- and look it! The key was to have exact change and the card in hand. Peru has such a chronic problem with change that if there are people in front of you with big bills, and the ticket guy sees you with a green student card and $10 in your hand, he will take it.

One more thing: there is a $10 Cuzco-area tourist ticket to see all the sights in the area in a certain number of days. If you buy the other, cheaper ticket just for a few ruins, keep in mind that you have to see all the ruins in one day, which would be a very long day as they are very spread out.
Anything you have to pay for in dollars is way, way over-priced considering how cheap everything else is--except for Machu Picchu. It is great at any price. Go for it.

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And finally, the very pompous:      This page © Copyright 2002, Kent Foster