The bank started with a high rate but it has fallen in recent months, trending along with most other online savings accounts. The website is easy to use and the customer service via telephone is also very courteous and competent. After using EmigrantDirect then DollarSavingsDirect for a couple of years, I switched to Ally because of a higher rate. However, if DollarSavingsDirect's rate rises above Ally's (they are .01% different right now) I will not hesitate to switch back. The only extra negative with DollarSavingsDirect is the $1000 min balance, but for me this isn't a big issue.
I found that Dollar's rate of 3.5% was one of the highest on this site and within minutes opened the account. I transfered most of my money over. That took a few days, but now I'm accruing interest.
So far, Dollar satisfies my basic needs in a Savings account; high rate, easy to transfer, daily compounding interest. Now I just have to start saving more!
Update: now that interest rates have fallen, Dollar is no longer as attractive. But, it's still has a competitive APY around at 1.20%
I opened an account with Dollar Savings Direct, because it advertised a very competitive interest rate at the time. When rates started to fall, DSD lowered theirs more than their internet banking competition. Now in 2013 it is easy to find higher interest rates elsewhere. I never liked the limitation that you could not link another savings account for funds transfer; you can only link a checking account. There are competitors who do not have this limitation. I also didn't realize that in the small print of the account disclosure, they say that they pay zero interest in any month that your balance is zero. I made the mistake of transferring all of my balance out of the account near the end of the month. I should have left a penny in the account, because they refused to pay any interest for that month. Rest assured, they lost this customer for good!