I know the term is widely used in America as a term for someone who has a love and anime and all things related to it. So in the US it's a term of endearment.
However in Japan the term is known more or less to be used to describe a shut-in / loner. But it actually originated from a few variations. One being the name of a stalker / murderer another just meaning someone with a love for Japanese culture.
So is the term really bad, good or more or less up to the individual to find a meaning?
This is somehow related to my question which has been closed (and I wonder why but I respect the administrator's decision). As far as I know, in Japan, the term otaku isn't positive at all. It means the same as being a geek or nerd or someone who's obsessed with something. And according to TVTropes,
Otaku come in many flavors, but one thing can be said for each and every one of them. They've each staked out their own favorite thing, and they obsess over it relentlessly. Regardless of other intelligence, an otaku will have an obsessive, unhealthy, and almost encyclopedic knowledge of their chosen topic.
There are almost as many flavors of this type of character as there are things under the sun, but a few of the major ones are:
- Anime or Manga Otaku
- Cosplay Otaku
- Gaming Otaku
- Idol Otaku (wota)
- Military Otaku
- Technology Otaku
Essentially, someone could be an otaku about just about anything: politics, sports, history, etc. When otaku is used by itself by a Westerner, 99% of the time it will mean "anime/manga otaku".
Neither geek nor nerd is an adequate translation. However, in modern use, both words may carry a shadow of the right connotations of obsessive interest and/or social ineptitude. Think of the older, more pejorative senses of geek and you're on the right track - the British term anorak is also a close translation. In Japan, the term Otaku does not carry a positive meaning, at all.
A semi-related term is hikikomori, which refers to a teenager or young adult who withdraws completely from society for an extended period, typically isolating themselves within their parents' house and become psychologically fixated to particular hobbies; hikikomori in media are usually otaku of some sort. Hikikomori are also critically viewed as lazy and outright creepy, which doesn't help the perception of otaku much. Especially after 1989, when serial killer Tsutomu Miyazaki was shown to be both an otaku and hikikomori, leading to a moral panic.
So I think the term otaku and being otaku yourself connotes something negative in Japan. Though, there are a lot of anime nowadays that features otaku characters. A major example is Lucky Star so I think they are somehow removing that negative connotations about being an otaku, though not generally.
The English term "trainspotter" gives some idea of how otaku are viewed in Japan; a trainspotter is essentially a "train otaku". That is, weird, antisocial, and not really "like the rest of us". Phrases like "gun nut" carry a similar flavour of being obsessed with something in a not-entirely-healthy way.
Given the Japanese culture values conformity, being "weird" is something more of a social stigma than it is in most Western countries.
As such, in the Japanese culture, being described as an otaku is almost universally negative.
I'm surprised that none of the other answers here provide reliable citations regarding the Japanese language or Japanese culture.
The Japanese Language SE has considered this question here, here, and here, pointing out that
Japanese people would not generally think to use otaku to refer to people outside of Japan who are passionate about hobbies.
In general Japanese culture, an interest in anime and manga is looked down upon, as I posted here:
Unlike in many parts of the world where manga and anime are considered esteemed art forms, in Japan most parents consider manga to be junk and discourage their kids 1) from reading manga, since they should be reading literary novels instead, and 2) from becoming a mangaka when they grow up. So most Japanese do not read manga as adults, and most who had a dream of being a mangaka gave up on it. Teens and adults who are involved in subculture are generally viewed negatively by the general populace [...]
It is due to this cultural perception that anime/manga fans have a somewhat negative association, and as a result why some were derogatorily referred to as otaku by others and/or some took on the term otaku to refer to themselves. It is not simply that otaku is a rude term used by haters that got thrown onto anime/manga fans, but early anime/manga fans themselves felt some embarrassment/shame over being such and described themselves self-deprecatingly as otaku.
The current generation of young adult anime/manga fans in Japan are still viewed as oddball by others; they have not reached the level of acceptance by society at large that Western otaku enjoy (for example, the popularity of the TV sitcom The Big Bang Theory or that in American people could mention in passing that they're going to a con or RenFair this weekend and many others won't judge them for it). However, the demographic is not as negatively viewed as it was in past generations. Now, they might jokingly refer to themselves as otaku.
But the Japanese adults who are unabashed anime/manga fans do not usually refer to themselves as otaku, but rather prefer using the term 「サブカルチャー」(subculture) to describe their interest and what they are involved in. This term, rather than focusing on oneself, focuses on being part of a group that differentiates itself from the parent culture to which it belongs in particular, intentional ways. This usage of subculture is used not only for anime/manga fans but for other demographics of Japanese people, such as those interested in the occult, clubbing, or reggae, which are likewise not mainstream hobbies in Japan.
In Japanese language and culture, the word otaku by itself does not include the meaning of 「引き籠もり」 (hikikomori, sometimes translated as "shut-in" or "acute social withdrawal"), which is a social and psychological phenomenon defined by the Japanese Ministry of Health, Labour and Welfare as those who people who refuse to leave their house for a period exceeding six months (further definitions have and are being created by researchers and mental health professionals). Some hikikomori have an interest in anime/manga/gaming, but others do not. Some became hikikomori after having experienced bullying at school, but the cause for others is unknown. According to the Japanese Constitution, children have a right to education, in other words, a right to attend school, but they are not legally required to attend school in order to make use of this right (this is why homeschooling is legal in Japan). As a result, becoming hikikomori is not illegal activity.
Article 26: All people shall have the right to receive an equal education correspondent to their ability, as provided for by law.
2) All people shall be obligated to have all boys and girls under their protection receive ordinary education as provided for by law. Such compulsory education shall be free.Article 27: All people shall have the right and the obligation to work
When I joined the Manga and Illustration Research Society at my Japanese university, I was a bit surprised to find out that most members are strongly socially awkward in ways which I hadn't seen prevalent among American fanboys/fangirls. There is an overlap between social awkwardness and social withdrawl and the Japanese anime/manga fan community, but it is not a simple and well-understood correlation. It could be that the less-socially-adept veer toward niche interests, or it could be that when a hikikomori is in his/her bedroom for years on end, it makes sense that he/she would gain an interest in hobbies that can be done alone at home using the TV or computer for entertainment and for reaching out to fellows through the web.
It makes good marketing sense that the growing number of hikikomori, of whom a sizable percent are interested in anime/manga/light novels, has created enough consumers who would relate to hikikomori protagonists that the Japanese companies are responding to this market by producing more titles that feature hikikomori in a positive light. This may figure into a cycle in which people who are considering making the switch to being hikikomori feel more like it is not a terribly shameful that that only losers do but that there are a lot of other people in the same boat (it's still too early to know whether these titles have any effect on increasing the numbers of hikikomori).
It may not be derogatory for people who describe themselves as "otaku" and who take pride in it, but it is without a doubt derogatory for other people.
Lots of japanese people who like anime/manga tend to avoid describing themselves as otaku, because to them it still carries the sense of that guy obssessed with anime who wears a collared plaid shirt tucked into their jeans, with a large backpack from which rolled posters can be seen. For example, you could see the slang きもオタ (kimo ota = abbreviation for "kimoi otaku" = disgusting otaku) on various japanese websites, including those like nicovideo, 2ch or futaba, which are, even so, famous places where those same "otaku" (western definition) dwell.
I would suggest watching the semi-anime, semi-documentary "Otaku no Video", which is kinda old, but still a lot accurate about how "normal" japanese people are conscious of their hobby.
