Select an area under a cabinet, in a closet or in your pantry to place the bin away from heat. Spread an old towel onto the floor and place two bricks about 18 inches apart. Place your bin on the bricks, and slip an old cake pan under the bin to catch any drainage.
Rip newspaper into 1-inch-wide strips, making enough to fill your bin one-half to two-thirds full. Wet the papers one strip at a time to dampen them. Add the strips to the bin to create a damp, but fluffy, pile of newspaper.
Spread two cups of coffee grounds over the paper, and place your worms over the grounds. Close the lid of the bin, and leave it for a week.
Collect 4 cups of food scraps such as fruit and vegetable peels, peanut shells, egg shells, apple cores and coffee grounds. Open the bin, and spread the food scraps over the newspaper. Close the lid.
Add 4 more cups of scraps every week for four weeks. During this time, the worms will become established, feed, and reproduce to be able to consume more food with more regularity.
Add additional scraps to the bin after the first month as often as they are available, adding up to a pound of food a day.
Prepare to collect the compost by pushing the bedding to one side of the bin the day before you want to collect, and don't add new food. Collect the exposed material from that side of the bin the following day, using a hand trowel, and put it in a container.
Push the newspaper bedding material back over the bin evenly, and add new food. Close the lid once more. Continue adding food material as it's available. Collect compost from the other side of the bin the next time you collect, and continue to alternate sides.