Edit the hosts file to add a local DNS entry.

Add the domain name you wish to use 127.0.0.1 is the loopback IP do not change this IP.

Create the folders and files for the local website. I chose to place the log files for apache in the site folder and the website content under a sub folder www.

Edit httpd.conf I used path finder here to show the locations.

You can also use VI or any text editor

On line 465 uncomment: Include /private/etc/apache2/extra/httpd-vhosts.conf and save the file.

Edit: /etc/apache2/extra/httpd-vhosts.conf

Add in the details of the new virtual host and save:
( I'm running Railo on Tomcat locally so I have so additional parameters )
I also set my logging levels to log as much as possible.
Notice the location of the logs files matched the access.log and error.log files created earlier

Run: apachectl -t
to confirm there are no syntax errors.
I choose to leave the example sites, they cause a warning but it wont stop apache.
Then restart apache: sudo apachectl restart

Create a test file in the new folder for the virtual host ( /Users/Paul/Sites/paulsDev/www )

Confirm the new virtual host works:

If you'd like to watch the logs in a terminal you can use tail:
tail -f /the/Path/to/the/log/file

BTW Dave made a great How-to on setting up Tomcat and Railo on OSX which you can view here.
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