Apple seemingly dropped the FTP Server support in Mac OX Lion. Only the GUI has been removed and the FTP Server can be activated.
You can still enable it with the command line. To start it type the Terminal command:
sudo -s launchctl load -w /System/Library/LaunchDaemons/ftp.plist
To stop it:
sudo -s launchctl unload -w /System/Library/LaunchDaemons/ftp.plist
[crarko adds: So if you need FTP, it's still available. It should easy enough to make an AppleScript to toggle this on and off. I'd probably turn it off while not using it. And of course if you turn on Remote Login (ssh), that will make SFTP available.]
Mac OS X Hints