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The current method for formatting a film script in Hollywood has evolved into a pretty rigid set of rules. If you do not follow the rules, people in hollywood will not read your script. And if they do they probably aren't the people you want making it into a movie. ;-)

I will try to list the some of the formatting rules here. If I miss one please feel free to add it here. And if you need professional examples check out www.script-o-rama.com.

Basics
The script must be typed in 12 point courier font. Its just a standard. Bind the script by using three whole punch and brass or metal fasteners. Usually only the bottom and top holes are used but its not that important.

Margins
The margins are the most overlooked part of screenplay format. The number of spaces from left are:
17 Left Margin
28 Dialogue
35 Parenthetical directions
43 Character name
66 Transitional instructions (CUT TO:, etc.)
72 Page number
75 Right Margin
Slugline
The slugline specifies the beginning of a new scene. It should be in ALL CAPS. It starts with an EXT or INT for exterior or interior. Then the setting of the scene. Then the time, DAY, MORNING, NIGHT etc..
EXT.  DESERT  NILE RIVER  VALLEY - DAY 

The slugline should be on a line of its own and if you are at the bottom of a page when a new scene starts always put the slugline at the top of the next page. In a shooting script the scene number appears off to the left of the slugline.

The scene
The scene is basically the building block of the script. It begins with a slugline. Double space then a scene description. This should be a short description of the setting, the people in the scene, their wardrobe, and any props. Then double space and begin the dialog or action. Action should be left aligned. Dialog must be centered. Dialog starts with one line that contains the characters name. If the character is offscreen there could be (V.O.) or (O.S) after the name. This is in cases of Voice Over or Off Screen dialog. On the next line the screen write can insert some acting directions. These should be very short like (angry) or (pointing). Then on the next line goes the dialog. Here's an example:
INT.  KORBEN'S  GARAGE - DAY

Korben enters his taxi.  A robotic voice greets him.

		VOICE
	Please enter your license..

Korben complies, and starts to push a series of buttons on the dash.

		VOICE
	Welcome on board Mr. Dallas..

		KORBEN
        How you doing this morning?  Sleep OK? 
	I didn't.

Korben hits a button.  The garage door starts to open.
Misc
There are many elements that should be printed in all caps. Most of this is for book keeping purposes. The first time an actor appears in a descriptive or action block his/her/its name should be in all caps. And when ever the character speaks the name should be in all caps. Stunts, props, sounds, and special effects should all be capitalized. Oh and lest I forget - a script should begin with the words FADE IN:, its just how these things go.

Be careful there are variations on this. And there are also things called shooting scripts which contain more information that is used when shooting the film. Remember a screenplay or film script is something a director will interpret when creating a movie. Don't include camera directions or do it sparingly. And make the story a good read. The best written scripts flow just like a good book does. The universally accepted standard for a great script is James Cameron's Terminator.

- And I hope that my girlfriend and her screenwriter friend forgive me for any errors/omissions that I may have made. ;-).

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