I'll speak up from my own experiences with bullying. In general, I've found that bullies are (cliche as it may be) doing it to get a reaction. With this in mind, there are a few methods you could use to take away their incentive:
1) Pity them. Their bullying just reveals how petty they are, and how you're better than them. If they want to make themselves look bad, go ahead. Just keep up this attitude and they'll get fed up and leave you alone. Note that actually saying anything like this out loud is generally a bad idea - they'll adapt and attack you for this before you're ready to truly handle it.
2) Laugh at yourself first. This generally works better if there's some element of humor in their bullying. If there isn't, you have to be a bit more creative and find it. Once you've switched around your reaction to the opposite of what they want, they'll either give up or even decide your cool and keep at it, but without the edge. In the latter case, you just have to remember that it's now all in jest, and they're no longer really trying to hurt you.
3) Give them a competing incentive. This method only works in a minority of bullying cases, but it did work for me. Basically, I was the freakishly smart guy in school, and this got me picked on. It also got me approached for help with homework and studying. I finally figured out to put these together. If people were nice to me, I'd help them out. If they bullied, I wouldn't. At first, I'd give them a reprieve if they were nice at least for a short period before asking for help. As they learned the value from this, I extended the time I'd require them to be nice until they had to be constantly nice if they wanted any help (a long memory helps here).
If it's really bad and unrelenting, I recommend you go to the school administration. Nowadays, many schools are cracking down on bullying, so they should be willing to help. If the person you talk to tells you to "suck it up" or whatever, try someone else. Chances are someone in the administration was a victim of bullying in the past (or just a decent person) and will be willing to help you. Yes, you'll get accused of being a "tattle-tale" (or the age-appropriate synonym), but that's only a bad thing for those who don't want to get caught. These people really don't want to get into actual trouble, and the threat of it will generally scare them off.