Drupal - Correct permission for site, default and files folders?

Actually the permissions should be

sites -> 755
sites/default -> 755
sites/default/files -> 775
sites/default/settings.php -> 444

See the top 3 answers to this question for some great details.

From Drupal's official handbook:

Copy this into a file and name it as "fix-permissions.sh"

#!/bin/bash
if [ $(id -u) != 0 ]; then
        printf "This script must be run as root.\n"
        exit 1
fi
drupal_path=${1%/}
drupal_user=${2}
httpd_group="${3:-www-data}"
# Help menu
print_help() {
cat <<-HELP
This script is used to fix permissions of a Drupal installation
you need to provide the following arguments:
1) Path to your Drupal installation.
2) Username of the user that you want to give files/directories ownership.
3) HTTPD group name (defaults to www-data for Apache).
Usage: (sudo) bash ${0##*/} --drupal_path=PATH --drupal_user=USER --httpd_group=GROUP
Example: (sudo) bash ${0##*/} --drupal_path=/usr/local/apache2/htdocs --drupal_user=john --httpd_group=www-data
HELP
exit 0
}
# Parse Command Line Arguments
while [ $# -gt 0 ]; do
        case "$1" in
                --drupal_path=*)
drupal_path="${1#*=}"
;;
--drupal_user=*)
drupal_user="${1#*=}"
;;
--httpd_group=*)
httpd_group="${1#*=}"
;;
--help) print_help;;
*)
printf "Invalid argument, run --help for valid arguments.\n";
exit 1
esac
shift
done
if [ -z "${drupal_path}" ] || [ ! -d "${drupal_path}/sites" ] || [ ! -f "${drupal_path}/core/modules/system/system.module" ] && [ ! -f "${drupal_path}/modules/system/system.module" ]; then
printf "Please provide a valid Drupal path.\n"
print_help
exit 1
fi
if [ -z "${drupal_user}" ] || [ $(id -un ${drupal_user} 2> /dev/null) != "${drupal_user}" ]; then
printf "Please provide a valid user.\n"
print_help
exit 1
fi
cd $drupal_path
printf "Changing ownership of all contents of "${drupal_path}":\n user => "${drupal_user}" \t group => "${httpd_group}"\n"
chown -R ${drupal_user}:${httpd_group} .
printf "Changing permissions of all directories inside "${drupal_path}" to "rwxr-x---"...\n"
find . -type d -exec chmod u=rwx,g=rx,o= '{}' \;
printf "Changing permissions of all files inside "${drupal_path}" to "rw-r-----"...\n"
find . -type f -exec chmod u=rw,g=r,o= '{}' \;
printf "Changing permissions of "files" directories in "${drupal_path}/sites" to "rwxrwx---"...\n"
cd sites
find . -type d -name files -exec chmod ug=rwx,o= '{}' \;
printf "Changing permissions of all files inside all "files" directories in "${drupal_path}/sites" to "rw-rw----"...\n"
printf "Changing permissions of all directories inside all "files" directories in "${drupal_path}/sites" to "rwxrwx---"...\n"
for x in ./*/files; do
find ${x} -type d -exec chmod ug=rwx,o= '{}' \;
find ${x} -type f -exec chmod ug=rw,o= '{}' \;
done
echo "Done settings proper permissions on files and directories"

Now run this script as: sudo bash fix-permissions.sh --drupal_path=your/drupal/path --drupal_user=your_user_name

Viola! Your permissions are automatically fixed.

This is how I decided to set permissions for my Drupal instance:

mkdir sites/default/files
chgrp -Rv apache sites/default/files
chmod 2775 sites/default/files

We do this by using 2775 in our chmod command. The 2 means that the group id will be preserved for any new files created in this directory. What that means is that apache will always be the group on any files, thereby ensuring that web server and the user will both always have write permissions to any new files that are placed in this directory. The first 7 means that the owner (example) can R (Read) W (Write) and X (Execute) any files in here. The second 7 means that group (www-data) can also R W and X any files in this directory. Finally, the 5 means that other users can R and X files, but not write.

Another point is to set correct permissions for your settings.php

chmod 444 sites/default/settings.php

Other permissions are to be default.

Complete Drupal Installation guide: http://itvictories.com/node/21