Server Types.
When creating your Paladin there are several things you must decide on. The first is what type of server you want to play on. The first type is a normal or PVE server which focuses on player versus enemy battles and dungeon raids. On this type of server you will be spending a great deal of time in parties and most of it will be supporting others with healing and buffs. If you prefer soloing though this would be the easiest server to do it on.
On a PVP server players focus on fighting with each other. It is somewhat harder to level up on this type of server since you are facing two types of enemies and you will often be “ganked” by the opposing side. This is more brutal and requires more coordination with other players so you don’t overwhelmed. Paladins can do very well in PVP since they are almost impossible to kill, but you will still want to try and stick with groups to bring out your full potential.
Finally there is the Roleplay server. RP servers have either PVE or PVP mechanics, but while playing you must put yourself in your characters role. Paladins are pretty much limited to roleplaying as zealous holy warriors and little else because of the lore in the game. So if you don’t like that type of person and want to play a paladin for its game mechanics you should chose a regular PVE or PVP server.
It is important to choose your server carefully because you can’t move to a different type of server once your character has been created.
Race
With the release of the Burning Crusade Expansion pack there are now four races that can play Paladins. The differences in stats between them all are rather small, especially at high levels so generally you should pick the one that is the most aesthetically pleasing. There are some racial abilities though that you should consider before making your choice.

Dwarf
Stoneform
Grants immunity to Bleed, Poison, and Disease effects while active. Also increases armor by 10% Lasts for 8 seconds with a three minute cool down.
Part of this ability is wasted since paladins get a spell to dispel disease and poison effects, but it’s good for getting rid of bleed effects (good for PVP) and the extra 10% more armor is nice for when you’re losing a fight. But it’s not enough to save you.
Gun Specialization
Increases your gun skill by +5.
This is useless since paladins can’t use any ranged weapons.
Frost Resistance
Gives you +10 to frost resistance.
By itself this is not enough to save you, but each of the races gets a resist bonus and frost is better then nothing. Especially since there are fewer pieces of gear with frost resist compared to other resists like fire and nature.
Find Treasure
This is pretty nice, especially when farming instances and dungeons. But if you take up mining or herbalism as a gathering skill you won’t be able to use it since you’ll want to track minerals or herbs.
Overall a dwarf only has one useful talent and two sort-of useful talents. They have higher combat stats then a human so they make good melee and tanking paladins.
Human
Perception
For twenty seconds your stealth detection is dramatically increased. Three minute cooldown.
This is only really useful when fighting rogues in duels and guarding flags and basses in PVP. When grinding or in a party I never even had it on my action bar.
The Human Spirit
Increases your Spirit by 5%.

This is a nice passive buff. But it means that for every hundred spirit you have you’ll only get an extra five. Five spirit is equivalent to about one mana and health regenerated

every two seconds. You will have at least eight thousand health and mana by level seventy so odds are you’ll never really notice this buff.
Diplomacy
You gain a 10% bonus anytime you gain reputation with an in game faction.
This is my favorite racial skill in the entire game. After level fifty a great deal of you time will be spent grinding faction. So this amounts to a ten percent reduction on the time you have to waste killing the same mobs over and over again.
Sword and Mace Specialization
+5 expertise to one handed and two handed swords and maces.
This is nice for when you are first starting out and will increase your chance to hit with these types of weapons. It has been changed from giving you crit, to increasing your change to hit and reducing the chance for an enemy to dodge. Because of this it is now more suited for tanking paladins. These are also the two types of weapons that paladins specialize in so it’s a useful ability.
Overall a human has no talents that specifically benefit a paladin, but several that make your journey a little bit easier. Humans also tend to have higher stats for casting then a dwarf so they make the best healing paladins.
Draenei
Gift of the Naaru
Heals your target over 15 seconds. 1.5 second cast, 3 min cooldown.
This is somewhat wasted on a class that can already heal, but it is the only way a paladin can heal over time. It doesn’t cost any mana though so it can be useful for helping to heal yourself while grinding.
Heroic Presence
Increases chance to hit by 1% for you and all party members within thirty yards.
This is probably the best racial ability a Draenei has. It is especially good when grouping with other melee characters like rogue and warriors.
Gemcutting
Automatic + 5 skill to Gemcutting.
This is like the other crafting racial. They aren’t terribly useful and have no specific benefits to a particular class.

Shadow Resistance
Increases shadow resistance by 10
Resistance racials are mainly used for lore purposes and are never enough to save you. As it stands now shadow resistance is only useful in a few select fights in dungeons. It’s a nice bonus by don’t worry to much about it.
Given the other lackluster racials of dwarfs and humans this probably makes Draenei the best race to play as a paladin if you want to be a member of the Alliance. Their racials also make them best suited for PVE activities.
Blood Elf
Mana Tap
When activated reduces the targets mana by 50 (scales with level) and carges you with arcane energy for ten minutes. Instant Cast, thirty second cool down.
Arcane Torrent
An AoE that silences all enemies within 8 yards for 2 seconds. You will also gain 5 mana+level for each charge of Mana Tap affecting you.
Arcane Affinity
Automatic + 10 skill to Enchanting.
Another simple crafting bonus that really won’t affect you as a paladin. Nice, but not great.
Magic Resistance
Increases all resistances by 5.
The biggest problem with resistance racials was that they only worked in certain encounters. This racial covers all encounters, but gives a lot less help.
As I’m sure you know, blood elves are the only horde race that can play as a paladin. So if you want to play a horde character they are your only choice and their racials don’t account for much. Over all the blood elf abilities are most useful in PVP where the silence from Arcane Torrent can interrupt spell casters.