I'm new to the Python and Django world, having primarily worked with Ruby and Ruby on Rails for the last few years. In reading about how to manage dependencies several folks referred to pip and distribute as the new hotness (literally). Ok, fine, they're probably something like ruby gems, but what's the difference?
Looking over their respective pages (http://pypi.python.org/pypi/pip and http://pypi.python.org/pypi/distribute) it is confusing to see that there appears to be some sort of circular dependency. The pip page says "In order to use pip, you must first install setuptools or distribute." The distribute page gives instructions for installing distribute via pip. Wha?!
The heading at the top of the pip page says "pip installs packages. Python packages." The heading of the distribute page says "Easily download, build, install, upgrade, and uninstall Python packages". Argh, still confused.
Pip is more clearly documented, and serves in the roll of package downloader, dependency resolver and installer. This would be analogous to yum or apt. I.e. pip does not create packages. Pip apparently replaces something called easy_install.
So if you're just using existing packages you'll just use pip, possibly in combination with virtualenv for isolation (similar to bundler in the Ruby world).
So what about distribute? The distribute documentation is terribly confusing. It says it replaces setuptools, but then seems to imply that it is setuptools. It looks like distribute is a fork of setuptools because the setuptools maintainer stopped maintenance. And I guess in parallel there's another tool called distutils. These all are used to make packages. As is usual for package making there's a metadata file (setup.py in this case) and setuptools/distribute/distutils take that and a directory full of files and makes a package.
And apparently because setuptools, distribute and distutils all have problems there's work underway on distutils2 to replace them all.
On a side note, you'll also find references to eggs. This is apparently a packaging format introduced by setuptools. It seems to have lost favor. The PyPI repository distributes packages as generic tarballs.
So, in summary if you're making a package use distribute or distutils, and if you're installing a package use pip. I think. :)