How do I set vertical space between list items?

Within a <ul> element, clearly the vertical spacing between lines can be formatted with the line-height attribute.

My question is, within a <ul> element, how do I set the vertical spacing between the list items?

You can use margin. See the example:

http://jsfiddle.net/LthgY/

li{
  margin: 10px 0;
}

HTML

<ul>
   <li>A</li>
   <li>B</li>
   <li>C</li>
   <li>D</li>
   <li>E</li>
</ul>

CSS

li:not(:last-child) {
    margin-bottom: 5px;
}

EDIT: If you don't use the special case for the last li element your list will have a small spacing afterwards which you can see here: http://jsfiddle.net/wQYw7/

Now compare that with my solution: http://jsfiddle.net/wQYw7/1/

Sure this doesn't work in older browsers but you can easily use js extensions which will enable this for older browsers.

I would be inclined to this which has the virtue of IE8 support.

li{
    margin-top: 10px;
    border:1px solid grey;
}

li:first-child {
    margin-top:0;
}

JSFiddle

Old question but I think it lacked an answer. I would use an adjacent siblings selector. This way we only write "one" line of CSS and take into consideration the space at the end or beginning, which most of the answers lacks.

li + li {
  margin-top: 10px;
}

Add a margin to your li tags. That will create space between the li and you can use line-height to set the spacing to the text within the li tags.