The deer park where Gautama Buddha first taught the Dharma is in Sarnath, and so the town is a major pilgrimage site. Within the deer park complex is a large stupa (Dhamekha Stupa) constructed by the Emperor Ashoka (2nd century B.C) and several other Buddhist structures that were added between the 3rd century BC and the 11th century AD.
Fly to Babatpur airport (24kms) from Delhi, Calcutta, Lucknow or Mumbai
Get a train to Varanasi Cantt. (6kms) stn as all major trains from the country pour in from here. Sarnath has a small train stn but it seems usless..
Buses reach to Bus stand near the railway stn cantt.
If you are in Varanasi city, you can take a taxi, auto rickshaw or bus. (higher cost in decending order) to Sarnath. Don't take a cyclerickshaw, its too long and polluted way.
Varied accomdation at Sarnath are the various monasteries like the Mahabodi dharmshala, Thai and Burmese for spartan costs and facilities. The Golden Buddha hotel is the closest place to stay that is a fully functional hotel with good ayurvedic massage, a Meditteranean restaurant and a quite lawn and outdoor hottub. they also have several types of rooms of different budgets. They have a website by the same name.
The govt tourist banglow is like all drab tourist banglows with good location. This is listed under the UPSTC website.
Staying in Sarnath and visiting Varanasi ghats in the day is the best idea. Its very peaceful and pollution free than the city.