If you are a citizen of a country that participates in the Visa Waiver Program (VWP), and you enter the U.S. by land from Mexico or Canada, ESTA is not required. If you do not have ESTA, you will be required to complete the paper I-94W form and proceed through a manual entry process at the land border crossing. If you have an approved ESTA when entering the U.S. at a land border crossing, you will NOT be required to complete the paper I-94W form and your entry process is expedited.
Note: VWP citizens do not need an ESTA to travel on the ferries between Vancouver and Victoria, BC and Washington state. They are treated as a land border port.