Pride

Pride is the virtue of moral ambitiousness: the commitment to shaping one's own character deliberately, as the achievement that makes every other achievement possible. Objectivism treats it as the virtue by which the cardinal value of self-esteem is earned, and calls the policy behind it "moral perfection".

“Pride is the recognition of the fact that you are your own highest value and, like all of man's values, it has to be earned.”
~ Ayn Rand, Atlas Shrugged

Man as a self-made soul

The argument for pride parallels the argument for productiveness, and Rand stated it as a deliberate pairing. Man must produce the physical values his life requires, because nature does not supply them ready-made. He must equally produce the traits of character his life requires, because those are not supplied ready-made either.

No automatic values means no automatic self-esteem. An animal's mode of survival is given to it. Man's is not, so he faces the question of whether he is competent to live — and the answer has to be established rather than assumed.
Character is chosen, not inherited. Choices made repeatedly become habits, habits become the automatic responses one calls a personality. That process runs whether or not anyone directs it; pride is the decision to direct it.
The achievement is the precondition of the rest. A person's ability to think clearly, hold to a purpose and deal honestly is what every other value he pursues depends on.

Moral perfection is a real standard

Rand's claim that a man can and should achieve moral perfection sounds extravagant until the standard is stated. It does not mean omniscience or infallibility. It means never permitting a breach one knows to be a breach:

Errors of knowledge are not moral failures. Acting against one's own judgment is.
The standard is therefore attainable at any level of knowledge, because it concerns the use one makes of what one has.
Where a breach has occurred, the response the virtue calls for is correction and restitution, not permanent guilt. Objectivism regards unearned guilt as corrosive in the same way as unearned praise.

Pride is not vanity

The word carries two meanings that Objectivism separates completely, and the conventional list of sins conflates.

Vanity is the pursuit of an unearned appearance of worth — the concern with seeming rather than being. It is a form of second-handedness; see Independence.
Arrogance is an estimate of oneself unsupported by evidence, which is a failure of objectivity like any other.
Humility, as a virtue, is the doctrine that man is inherently unworthy. Objectivism rejects it as an inversion: what it treats as sinful is precisely the ambition to be good.

Genuine pride is a conclusion drawn from evidence about one's own character, and it is as revisable as any other conclusion.

Common misunderstandings

That it means thinking oneself superior to others. The standard is a person's own potential, not a ranking. Comparison with other people is what vanity substitutes for the real measure.
That it forbids admitting a mistake. The opposite: an unadmitted mistake is an uncorrected one, which the virtue cannot tolerate.
That it is the same as self-esteem. Self-esteem is the value; pride is the virtue that achieves it. Rand's pairing of the two mirrors reason with rationality and purpose with productiveness.
That it is incompatible with admiring others. Admiration of a value one recognises is an exercise of justice, and Objectivism treats it as a mark of self-confidence rather than a threat to it.

Discussion

References

Rand, Ayn. "The Objectivist Ethics", The Virtue of Selfishness. New American Library, 1964.
Rand, Ayn. Atlas Shrugged — Galt's speech, on pride and the self-made soul.
Branden, Nathaniel. The Psychology of Self-Esteem. Nash Publishing, 1969.
Peikoff, Leonard. Objectivism: The Philosophy of Ayn Rand, chapter 8.

External links

Pride at the Ayn Rand Lexicon