The East Timor Backpackers hostel, next to Tiger Fuel in Dili, rents motorcycles for $15-20 per day. There are likely other people that will rent you their bikes as well. Motorcycles/scooters are a great way to see the country: you'll be afforded the freedom of traveling wherever you want at any time, and will have a rather small responsibility in terms of a bike to park over night. Bungee cords may be purchased from Star Moto in Baucau to fasten your luggage to the bike.
Taxis are one of the best means of transport in and around Dili. Fares are not very steep $1-3 and there are lots of them!
You can hire a vehicle 4WD in Dili for around $85 a day. However, do be prepared for adventure - besides the tricky roads there is the lack of road signs to contend with. It is possible that you will get so caught up with driving that you miss out the great scenery around you.
While in Dili you will need to confine yourself to a speed limit of 40 kph. On open roads you may rev up and touch 50-60 kph. Tourists from the west might find the going slow but that is the maximum speed that can be achieved on Dili roads.
Ensure that you are carrying a valid driving license or permit with you. This can be either from your country or you can have it issued in East Timor. Your license should specify the kind of vehicle you are allowed to drive. Do drive carefully and remember that there is no provision here for third-party motor insurance.
One other option is renting ex-Australian post office motorcycles. These are supplied by the East Timor Backpackers hostel. Mountain bikes or cars can also be hired and there is always the option of taking a walking tour.
Buses, mostly of the small variety found on remote Indonesian islands, run to most parts of the country and main cities like Dili, Baucau, Maliana, Los Palos and Suai are quite well linked. Indonesian-style bemos vans and mikrolets minibuses - legacies from its 24-year rule - run from these cities to nearby villages.
Most departures take place very early in the morning and drivers have a tendency of doing keliling Indonesian for "going round" where they spend considerable time combing the streets and scouting for passengers before actually departing.
Fares are about US$2 or US$3 for journeys over 100km. For example, Dili-Baucau 123km costs US$2 while Dili-Mota'ain 115km costs US$3.