In Japan: an otaku is someone without a social life whatsoever and is an insult of the highest regard. There is a negative stigma associated to the phrase otherwise that involves a Japanese murderer who killed women because "they didn't have smooth faces like women in anime."
In America: a badge of honor worn by fans of anime, in lieu of simply calling themselves anime fans. Overused slang that has lost its meaning to many fanboys and fangirls.
In Japan: "With the amount of pornography that man buys, it's no wonder they consider him a disgusting otaku."
In America: "Dude, I love Sailor Moon and Utena because they have lesbians in it. I'm such an otaku! ^___^"