If you have a digital SLR, you’ll have an easier time–and more options–when setting up your camera for fireworks.
In a nutshell, you’ll want to dial in the lowest ISO, throw the camera into full manual mode, choose a small aperture opening (try starting at f/8), and pick a slow shutter speed with an exposure time of between one and four seconds. After you take your first few pictures, review them to see if you’re getting realistic color. If the bright blue, orange, and red fireworks all look kind of white, you should use the same exposure time but close the aperture a bit and try again. That means changing your f/8 setting to f/11 or perhaps f/16. If the fireworks are too dim, open the aperture to f/5.6 or f/4.
Most SLRs have a bulb mode that leaves the shutter open for as long as you hold down the shutter release, giving you total control over the exposure. When the fireworks launch, press the shutter release to start the exposure. Hold the button down until after the fireworks have bloomed, several seconds later. If you go for very long exposures, you should cover the lens between fireworks.
(Photo by *etoile.)